APP plans legal action against creditors<\/p>\n
Dow Jones, Jakarta<\/p>\n
Asia Pulp & Paper Co. said Thursday it will fight a recent
\npetition at the Singapore High Court by two of its creditors to
\nput the company under judicial management while it restructures
\nUS$13.4 billion in debt.<\/p>\n
Deutsche Bank AG, a member of APP's creditor steering
\ncommittee, and BNP Paribas filed the petition earlier this week
\nto ask the court to appoint an independent manager for the ailing
\npulp and paper company. In the petition, the banks said creditors
\nwere concerned APP's current management was stalling the
\nrestructuring process.<\/p>\n
\"APP intends fully and vigorously to resist the petition,\" the
\nSingapore-headquartered company said in a statement. \"APP plans
\nto respond swiftly and comprehensively to the petition and has
\ninstructed its legal adviser accordingly.\"<\/p>\n
APP, which is a holding company for Indonesia's Sinar Mas
\nGroup, called a debt standstill in March last year after years of
\nheavy borrowing. The point of the standstill was to give the
\ncompany breathing space so it could recover and start paying its
\nsuppliers again.<\/p>\n
The company began restructuring talks soon afterwards with
\nhundreds of creditors which include banks, credit export agencies
\nand private bondholders.<\/p>\n
Creditors rejected in February an initial debt restructuring
\nplan drawn up by APP with its financial advisers Credit Suisse
\nFirst Boston.<\/p>\n
APP countered Deutsche Bank's claims that the current
\nmanagement was delaying the restructuring, saying this failed to
\ntake into account the \"sheer size of the creditor group.\"<\/p>\n
\"Further, there are complex inter-creditor tensions and
\nconflicts which have the unfortunate, though real, effect of
\ncomplicating and lengthening the restructuring discussions,\"
\nAPP's statement said.<\/p>\n
Deutsche Bank's appeal to the court to remove the management
\nunderscores the tensions in APP's debt restructuring. People
\nclose to the talks said they were surprised the bank had taken a
\nunilateral action while it remained a member of the creditor
\nsteering committee.<\/p>\n
Attempts to draw up another debt workout plan have stalled
\namid a row over payment with accounting firm KPMG, which carried
\nout a review of APP's businesses for the creditors, said a person
\nclose to the talks.<\/p>\n
Since APP, which has pulp and paper businesses in Indonesia
\nand China, stopped paying suppliers last year, more than 10
\nlawsuits seeking repayment have been filed in Singapore.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/app-plans-legal-action-against-creditors-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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