Council to investigate lost Sheraton shares<\/p>\n
Zakki Hakim, The Jakarta Post, Jakarta<\/p>\n
A council member said the recent disclosure of the city's
\ndwindling equity in the Sheraton Media hotel has raised two major
\nquestions: why does the hotel have such huge outstanding debts
\nand who were the decision-makers involved in the whole affair?<\/p>\n
Ugiek Soegihardjo, a member of the City Council's Commission B
\nfor economic affairs, said the legislature was scheduled to meet
\nthis week with representatives of the administration to clear up
\nthe matter.<\/p>\n
The city's Economic Administrative Bureau has said it will
\npresent the minutes of the hotel's shareholder meeting on Feb.
\n14, 2001, which should help establish who was responsible for the
\ncity's dwindling equity in the Sheraton, Ugiek told The Jakarta
\nPost over the weekend.<\/p>\n
He said the bureau also intended to present documents that
\ncould explain why the hotel has outstanding debts to Bank BNI 46
\namounting to Rp 108.51 billion (approximately US$12.72 million)
\nand to London Forfeiting Asia Limited worth US$50 million, which
\nwas guaranteed by the bank.<\/p>\n
The council will also summon former city secretary Marolop
\nSinurat, a commissioner of the hotel in its early days, because
\nhe is believed to have knowledge of the city's dealings with the
\nhotel, Ugiek said.<\/p>\n
The council has demanded that the city's share in the hotel be
\nreturned to the 25 percent agreed upon initially, and that the
\n18,682 square meters of city land be returned.<\/p>\n
The council also called for a thorough probe into the case,
\nwhich involves media figure and possible presidential candidate
\nSurya Paloh, who is reportedly one of the founders of PT Bhakti
\nCiptadaya (BCD), the city's partner in the joint venture company
\nthat owns the hotel.<\/p>\n
In a meeting with the council on Thursday, the Economic
\nAdministrative Bureau provided clues as to how the city lost
\nshares and property to the joint venture company that built and
\nmanaged the Sheraton Media hotel on Jl. Gunung Sahari in Central
\nJakarta.<\/p>\n
It was explained that the joint venture company had an
\nenormous outstanding debt to Bank BNI 46, so in a debt
\nrestructuring measure in 1999 it was decided to exercise a debt
\nfor equity swap option during several shareholders meetings.
\nAfter a shareholders meeting on Feb. 14, 2001, the ownership
\ncomposition of the hotel was altered, giving BNI 46 66.39 percent
\nof the shares, BCD 25.21 percent and leaving the city holding
\nonly 8.40 percent.<\/p>\n
A source at the Indonesian Banking Restructuring Agency told
\nthe Post that BNI 46 could only retain the shares for two years,
\nand therefore it might have to sell them in the near future.<\/p>\n
If the bank were to sell the shares it would be difficult for
\nthe city to buy them back, considering that in 2000 the price was
\nalready Rp 9.4 million per share, a city official said.<\/p>\n
The city might have to find a cheaper solution to gain back
\nits 25 percent ownership in the hotel, or it might have to come
\nup with about Rp 66.61 billion to buy at least 7,100 shares, he
\nsaid.<\/p>",
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"sponsor": "Okusi Associates",
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