Govt to finalize Chandra Asri debt today: Rini<\/p>\n
JAKARTA (JP): The government plans to finalize the long-
\nawaited debt restructuring of petrochemical giant PT Chandra Asri
\nlate on Thursday, Minister of Industry and Trade Rini Soewandi
\nsaid on Wednesday.<\/p>\n
Rini said that the decision was expected to be made at a
\nmeeting of the Financial Sector Policy Committee (FSPC), which
\ngroups several senior economic ministers.<\/p>\n
\"The government will finalize (the) Chandra Asri
\n(restructuring) tomorrow afternoon in the FSPC meeting,\" she said
\nafter the opening of the 2001 Indonesian International Chemical
\nExhibition and Conference.<\/p>\n
The government has been trying to hammer out a restructuring
\ndeal for Chandra Asri's massive debts for 19 months. The company
\nowes around US$723 million to a foreign creditor consortium led
\nby Japan's Marubeni Corp., and another $464 million to the
\nIndonesian Bank Restructuring Agency (IBRA) which assumed the
\ndebt from ailing domestic banks.<\/p>\n
Sources said that the Japanese government had been putting
\npressure on the Indonesian government to complete the
\nrestructuring deal immediately. Japan is the country's largest
\nlender.<\/p>\n
A restructuring deal hammered out in May by former
\ncoordinating minister for the economy Rizal Ramli was criticized
\nby IBRA's oversight committee as being advantageous to the
\nJapanese creditors, to the detriment of IBRA.<\/p>\n
Under the restructuring scheme, the Japanese creditors would
\nconvert $100 million of their loans into 20 percent equity in
\nChandra Asri, while IBRA would convert $413 million of its $464
\nmillion loans into a 31 percent stake. The remaining 49 percent
\nwould be held by Chandra Asri founder Prajogo Pangestu.<\/p>\n
While the Japanese creditors agreed to lower interest rates
\nand extend the payment period, IBRA insisted that Marubeni
\nconvert more debt into equity.<\/p>\n
Rini has said that the government believed the olefin producer
\nwas worth fighting for and therefore should be maintained,
\nhowever, she explained that the company's debt restructuring
\nscheme should not be a burden on the government.<\/p>\n
\"The key is how to minimize the government's bailout funds
\nwithout jeopardizing the company's operation,\" she said.<\/p>\n
Meanwhile, former IBRA consultant Amir Sambodo, who was also
\npresent at the exhibition, called on the government to help find
\na solution for Chandra Asri's debt problems.<\/p>\n
\"The government truly realizes the strategic role of the
\nchemical industry,\" Amir said, as reported by Antara.<\/p>\n
Amir said that the government should be more aggressive in
\nasking the Japanese creditors to surrender more of Chandra Asri's
\ndebts with them in return for a higher stake in the company.<\/p>\n
\"I think Marubeni will be OK with this because Marubeni is not
\nreally new in this business,\" Amir added.<\/p>\n
Meanwhile, the international chemical exhibition, which will
\nrun until September 7, has 46 exhibitors including several
\nforeign companies.<\/p>\n
The exhibition is organized by the Federation of Indonesian
\nChemical Manufactures in cooperation with PT Debindo Multi
\nAdhiswati.(10)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/govt-to-finalize-chandra-asri-debt-today-rini-1447893297",
"image": ""
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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