Debt restructuring meassure will save Merpati, pilots say<\/p>\n
Debbie A. Lubis, The Jakarta Post, Jakarta<\/p>\n
Pilots at state-owned PT Merpati Nusantara Airlines are
\ncalling for the restructuring of the company's debt to reverse a
\ndecade-long slump, in the latest move ahead of an imminent
\nmanagement reshuffle at the airline.<\/p>\n
Chairman of the Merpati Pilot Association (APM), Sardjono
\nJohni said the airline's new management should restructure the
\ncompany debts. They amount to Rp 1.713 trillion as of Dec. 2000.<\/p>\n
\"They (new management) should convince creditors to reschedule
\nthe debts if they want to revive Merpati,\" Sardjono told The
\nJakarta Post on Saturday.<\/p>\n
Merpati, which once pioneered routes into eastern Indonesia,
\nhas been seeing red over the past 10 years, with the exception of
\n1999 when gross profit was Rp 72.47 billion (about US$758,000).<\/p>\n
The company plans to issue medium term notes to repay Rp 256
\nbillion in debts maturing this Thursday to the Indonesian Bank
\nRestructuring Agency (IBRA).<\/p>\n
The plan requires government approval which is not yet
\nforthcoming.<\/p>\n
APM has laid the blame for the company's financial woes on
\non its current management, whom they charge are incompetent.<\/p>\n
Sardjono said Merpati invested in a new reservation program
\nwhich failed to meet expectations, causing a potential loss of up
\nto Rp 10 billion last month.<\/p>\n
Merpati rented a Boeing but could not fly it to Singapore next
\nyear because there the plane was considered too noisy.<\/p>\n
APM's call for the restructuring of Merpati's debts comes amid
\nquestions over who would be the airline's new president director.<\/p>\n
The government plans to reshuffle the management, having
\ncompleted a fit and proper test for its top position in February.<\/p>\n
As yet there has been no follow up on the tests, despite the
\npromise to complete the reshuffle by February, according to
\nSardjono.<\/p>\n
\"We have sent our fifth letter to the Office of the State
\nMinister of State Enterprises, but we have not received any
\nreply,\" he said.<\/p>\n
Numbering 620 pilots, APM has been demanding the dismissal of
\nMerpati's board of directors since last January.<\/p>\n
Sardjono said the new management should be able to persuade
\nthe government to let Merpati tap fresh capital.<\/p>\n
Merpati is 93.5 percent owned by government and 6.5 percent by
\nnational flag carrier PT Garuda Indonesia.<\/p>\n
There are about six candidates vying for Merpati's top
\nposition with backgrounds in consulting, finance and engineering.<\/p>\n
Among them is Harry Parjaman, a senior official at Merpati's
\nasset management unit. Harry is believed to be APM's choice.<\/p>\n
\"He (the new president) should have been working in Merpati
\nfor years as we don't accept outsiders yet we also reject anyone
\nfrom the current management; they have already failed,\" Sardjono
\nsaid.<\/p>\n
Harry has worked for the airline for 26 years and is not a
\nmember of the current board of directors.<\/p>\n
Another candidate is Hotasi Nababan, the president of PT GE
\nLokomotif Indonesia.<\/p>\n
He said Merpati needed a person who dared to take risks and
\nmake unpopular decisions when times get tough. Hotasi once worked
\nfor the national flag carrier Garuda .<\/p>\n
He also saw no need to lay off workers, saying they brought
\n\"changes, and fresh and bright ideas.\"<\/p>\n
This represented a different approach from Merpati's outgoing
\npresident Wahyu Hidayat who said earlier the airline needed to
\ncut around 1,500 employees.<\/p>\n
But Wahyu did not dismiss workers when he became president of
\nMerpati in 1999. According to him, labor opposition had been be
\ntoo strong.<\/p>\n
Commenting on his replacement he suggested someone with
\ncredibility to help Merpati wade through tough debt negotiation
\ntalks.<\/p>\n
\"The company is already damaged; I'm afraid investors will
\nwithhold their money if they doubt the person's trustworthiness,\"
\nhe said in an interview last week.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/debt-restructuring-meassure-will-save-merpati-pilots-say-1447893297",
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