Govt, Marubeni to split Chandra Asri 80%:20%<\/p>\n
JAKARTA (Dow Jones): After long and tedious negotiations, the
\nIndonesian government and Japan's Marubeni Corp. (J.MRB) have
\nagreed in principle to split PT Chandra Asri Petrochemical
\nCenter's equity 80 percent: 20 percent, a government official
\nsaid on Tuesday.<\/p>\n
The split is part of the solution to restructure the company's
\ndebt totaling around US$1.05 billion.<\/p>\n
Dipo Alam, a deputy of the coordinating minister for economy,
\nfinance and industry, said the government will own 80 percent of
\nChandra Asri and Marubeni the remaining 20 percent.<\/p>\n
Dipo added that as the government and Marubeni have agreed to
\nconvert Chandra Asri's debt into equity, the three original
\nshareholders of the company will no longer own any stake.<\/p>\n
\"I think they should accept the fact that their ownership (in
\nChandra Asri) will be zero,\" Dipo said.<\/p>\n
The three local businessmen, Prayogo Pangestu, Hendri Pribadi
\nand former President Soeharto's middle son Bambang Trihatmodjo
\nwere the original shareholders of the nation's largest olefin
\nproducer.<\/p>\n
The Indonesian Bank Restructuring Agency ended up as the
\ncreditor of Chandra Asri after domestic banks transferred their
\nnon-performing loans, including the ones provided to Chandra
\nAsri, to the bank agency.<\/p>\n
Marubeni is the main guarantor of the $723 million of loan
\nprovided by Japanese financial institutions.<\/p>\n
Earlier, the government proposed to split Chandra Asri's
\nequity equally with Marubeni. The Japanese company, however,
\ninsisted to get only a minority stake although the loans it
\nguarantees represent almost 69 percent of Chandra Asri's $1.05
\nbillion debt.<\/p>\n
By agreeing to obtain a higher stake in Chandra Asri, the
\ngovernment may have to pay the company's remaining debt to
\nJapanese lenders.<\/p>\n
\"This thing is being discussed,\" Dipo said when asked whether
\nthe government will have to pay the remaining debt to Japanese
\nlenders.<\/p>\n
He added that Japan Bank For International Cooperation has
\npledged to help provide a loan to Chandra Asri to revamp its
\noperation.<\/p>\n
Chandra Asri plant is located in Cilegon, West Java and
\nproduces ethylene, polyethylene, and propylene -- the base
\nmaterials for plastic.<\/p>\n
The plant was built in the early 1990s and was given import
\ntariff protection by Soeharto's government.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/govt-marubeni-to-split-chandra-asri-8020-1447893297",
"image": ""
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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