Ika Krismantari , THE JAKARTA POST , JAKARTA<\/p>\n
The local supplier of Adidas shoes PT Prima Inreksa Industries (PII) is facing bankruptcy litigation for failing to pay debts worth more than US$37 million.<\/p>\n
The plaintiffs are PII leather supplier CV Cisarua and state owned Bank Negara Indonesia (BNI). PII has not yet paid its debts to either.<\/p>\n
\u201cThe litigation is our last resort, we have tried the mediation process, but it always ended up with [PII] saying they don\u2019t have the money to pay the bills,\u201d Yakobus Eko Adrianto, a lawyer representing CV Cisarua, told The Jakarta Post on Tuesday.<\/p>\n
Yakobus said that legal steps are being taken because Cisarua observes that PII is still operating and employing about 5,000 workers; contradicting their claim of lack of money.
\n\u201c[Thus} they don\u2019t have reasons to avoid their obligations,\u201d Yakobus said.<\/p>\n
PII has failed to pay debts amounting to Rp 2 billion (US$168,000) to Cisarua, on top of a larger $37.25 million outstanding debt to BNI.<\/p>\n
Last year PII also had debts amounting to $8 million to suppliers, according to data from the Industry Ministry.<\/p>\n
The litigation was filed with the Central Jakarta District Court on Commerce and scheduled to begin on Tuesday, but due to the absence of a representative from PII, it was adjourned until next week<\/p>\n
\u201cShould they fail to appear in next week\u2019s trial, we will still proceed with the case. [The court] will proceed [in absentia],\u201d Yakobus said.<\/p>\n
Contacted separately, PII president director Paulus Harli said he had no idea about the litigation and refused to comment further.<\/p>\n
Yakobus said his client filed the case together with BNI because under the existing regulations, bankruptcy litigation requires at least two companies to act as plaintiffs.<\/p>\n
The bankruptcy litigation is the latest problem faced by PII after its previous main buyer, the world\u2019s second-largest sportswear manufacturer, Adidas Group, placed its final orders with them last year.<\/p>\n
Adidas, which ordered 201 million pairs of shoes from the Indonesian shoe industry last year, had been ordering 500,000 pairs of shoes per month from PII since 1997.<\/p>\n
Adidas and PII signed last August a final partnership agreement, in which the final date for the termination of the business relationship was Dec. 31, 2008.\u201d<\/p>\n
PII was one of six Indonesian companies manufacturing sport shoes for Adidas.<\/p>\n
Before facing the negative impacts of the global economic crisis, affecting export orders and revenues, PII -- located in Banten, Tangerang -- produced up to 900,000 pairs of shoes annually for Adidas.<\/p>\n
Adidas has been manufacturing sports shoes in Indonesia for about 20 years.<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/adidas-supplier-faces-bankruptcy-suit-1236751047", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }