Astra names advisors to restructure debt<\/p>\n
JAKARTA (JP): The country's largest automobile producer, PT
\nAstra International, has appointed three foreign banks -- Chase
\nManhattan Bank, Sakura Merchant Bank and Sumitomo Bank -- as
\nfinancial advisors in its efforts to restructure US$2 billion in
\nforeign debt, the company president said yesterday.<\/p>\n
Rini M. Soewandi said the newly-appointed financial advisors
\nwere scheduled to meet with the firm's foreign creditors, mostly
\nJapanese banks, next week in Singapore to discuss the debt
\nrescheduling plan.<\/p>\n
\"Our financial advisors will have their first meeting with our
\nforeign creditors in Singapore on August 5,\" she said after an
\nextraordinary meeting of shareholders.<\/p>\n
She said that Chase Manhattan Bank would coordinate the team.<\/p>\n
\"The aim of the meeting in Singapore is to introduce our
\nfinancial advisors to our foreign creditors,\" she said. \"Talks on
\nthe restructuring plan are still in a preliminary stage,\" she
\nadded.<\/p>\n
She said the company also owes Rp 2 trillion to domestic
\nfinancial institutions.<\/p>\n
She said that rescheduling the foreign debt was urgent to
\nensure the company survived the country's worst ever economic
\ncrisis, which was triggered by a sharp drop in the value of the
\nrupiah against the U.S. dollar.<\/p>\n
The appointment of financial advisors to help reschedule the
\noffshore debt meant the company would not need to join the newly
\nestablished Indonesian Debt Restructuring Agency (INDRA), she
\nargued.<\/p>\n
INDRA, which is expected to start operations on August 3, will
\nhelp cash-strapped companies repay foreign creditors.<\/p>\n
As part of the company's business restructuring program Astra
\nInternational obtained approval to sell the company's entire
\nstake in PT Astra Microtronics Technology (AMT), a Batam island-
\nbased producer of semiconductor products, from shareholders
\nyesterday.<\/p>\n
\"PT Astra International plans to sell all of its 96.07 million
\nshares in AMT,\" she said.<\/p>\n
Although the company has yet to find a buyer, she said the
\nsale was expected to raise between US$90 million and $95 million.<\/p>\n
Astra controls an 87.74 percent stake in AMT and the remainder
\nis held by Astra subsidiary PT Astra Graphia.<\/p>\n
\"The sale will allow the company to focus more on its core
\nbusiness activities and strengthen its financial structure,\" she
\nsaid.<\/p>\n
Rini said yesterday that the company's recent poor financial
\nperformance had yet to bottom out and that results from the first
\nquarter of the year were not \"promising\".<\/p>\n
Astra sold 10,804 cars in the first quarter of this year, down
\n62 percent from the 28,603 cars sold in the same period last
\nyear.<\/p>\n
Rini declined to provide financial details for the first half
\nof the year but said car sales for June were a mere 5 percent of
\nsales in the same month in 1997.<\/p>\n
\"We will announce figures for the first half of this year in
\nmid August after Astra's subsidiaries have submitted their
\nfinancial reports,\" she said.<\/p>\n
Astra International director Rudyanto Hardjanto said the
\ncompany plans to resume production of its popular Kijang model in
\nSeptember this year. Production was halted in May due to sluggish
\ndemand.<\/p>\n
\"We expect to produce around 1,000 Kijangs in September,\" he
\nsaid.<\/p>\n
Rudyanto, who is also president director of PT Toyota Astra
\nMotor -- a joint venture between Astra International and Toyota
\nMotors Corp. of Japan -- said that resumption of production would
\nallow the company to reinstate 30 percent of its 4,000 strong
\nworkforce. The workers are currently on paid leave.<\/p>\n
\"Although we plan to assemble 1,000 Kijangs, production will
\nstill be lower than that before the crisis,\" he said. (aly)<\/p>",
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