Chandra Asri urges govt to complete restructuring<\/p>\n
CILEGON, Banten (JP): The management of petrochemical giant PT
\nChandra Asri Petrochemical Center called on the government to
\nquickly complete the company's debt restructuring program to
\navoid further financial losses.<\/p>\n
\"We hope the government will immediately finalize Chandra
\nAsri's debt restructuring which has been stalled for more than
\ntwo years,\" Chandra Asri's vice president Leo Mulyadi told
\nreporters on Saturday on the sidelines of a company gathering to
\ncelebrate its sixth anniversary.<\/p>\n
Meanwhile, company finance manager Salikim said that further
\npostponement would only cause ballooning interest payments.<\/p>\n
\"The government must keep in mind that what we're doing is
\ntrying to prevent greater losses,\" he said.<\/p>\n
Chandra Asri owes some US$730 million to a consortium of
\nforeign creditors led by Japan's Marubeni Corp., and another $464
\nmillion to the Indonesian Bank Restructuring Agency (IBRA), which
\ntook over the loans from ailing domestic banks.<\/p>\n
The restructuring of Chandra Asri debts has been dragging on
\ndue primarily to disagreements between the Japanese creditor and
\nIBRA.<\/p>\n
The last restructuring deal approved by the previous economics
\nteam led by then coordinating minister for the economy Rizal
\nRamli was rejected by IBRA, and was alleged by the agency's
\nindependent oversight committee to favor the Japanese creditors
\nand be disadvantageous to IBRA.<\/p>\n
Minister of Trade and Industry Rini MS Soewandi is currently
\ntrying to sort out the mess. Earlier this month, Rini said that
\nthe government was expected to reach a restructuring agreement
\nsoon.<\/p>\n
Sources said that the government had been under pressure from
\nthe Japanese government to complete the restructuring deal.<\/p>\n
Japan is the country's largest creditor and foreign investor.<\/p>\n
Under the earlier deal signed by Rizal, the Japanese creditors
\nwere to convert $100 million of their loans into 20 percent
\nequity in Chandra Asri. The rest of the loans were then to have
\nbeen repayable over a 15-year period with an interest rate of 1.5
\npercentage points above the London Interbank Offered Rate
\n(Libor).<\/p>\n
But IBRA has insisted on Marubeni taking a greater share of
\nthe risk in Chandra Asri by converting more loans into equity.<\/p>\n
Under the initial scheme, IBRA was to have converted a much
\ngreater portion of its loans into a 31 percent equity stake in
\nChandra Asri, while the remaining 49 percent equity was to have
\nbeen held by company founder Prajogo Pangestu.<\/p>\n
Chandra Asri manufactures various monomer and polymer products
\nwhich are used in a wide range of industries like textiles,
\nplastics, chemicals.<\/p>\n
It produces around 510,000 metric tons per annum (MTA) of
\nethylene, 240,000 MTA of propylene, 210,000 MTA of pyrolysis
\ngasoline, 200,000 MTA of linear low-density polyethylene and
\n160,000 MTA of high-density polyethylene. (dmr)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/chandra-asri-urges-govt-to-complete-restructuring-1447893297",
"image": ""
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