Gus Dur, Marubeni boss to decide Chandra Asri's fate<\/p>\n
JAKARTA (JP): President Abdurrahman Wahid and the president of
\nJapanese giant trading house Marubeni Corp. will soon meet here
\nto discuss the fate of financially troubled petrochemical giant
\nPT Chandra Asri Petrochemical Center, a senior minister said here
\non Saturday.<\/p>\n
Coordinating Minister for Economy, Finance and Industry Kwik
\nKian Gie said the President would make a final decision on
\nChandra Asri's financial problems.<\/p>\n
He said the Financial Sector Policy Committee (FSPC), which
\ngroups several senior economics ministers, had already discussed
\nthe various options to resolve Chandra Asri's huge debt problems.<\/p>\n
\"I'm only waiting for the right moment to consult (the FSPC
\ndecision) with the President, and he will make the final
\ndecision,\" he announced following a luncheon with visiting Brunei
\nSultan Hasanal Bolkiah.<\/p>\n
But Kwik stressed that the meeting between Abdurrahman,
\npopularly called Gus Dur, and Marubeni's president would not only
\nfocus on Chandra Asri but also on overall economic cooperation
\nbecause Marubeni was a business conglomerate.<\/p>\n
\"There are several options which are basically aimed at
\nrestructuring Chandra Asri's debts so that the company can
\ncontinue operating,\" he said.<\/p>\n
Kwik said that a resolution to the Chandra Asri debt might end
\nup with the government owning 80 percent of the company and
\nMarubeni 20 percent through a debt-to-equity swap.<\/p>\n
\"The share ownership will change to 80:20,\" he said.<\/p>\n
Kwik did not provide further details.<\/p>\n
Chandra Asri is the country's largest ethylene producer with a
\nproduction capacity of 520,000 metric tons of ethylene per year.<\/p>\n
The company was a joint venture formed in the early 1990s
\nbetween Japan's Marubeni, Showa Denko and Toyo Engineering, and
\nlocal partners Bimantara and the Barito Group.<\/p>\n
Bimantara is a business group owned by Bambang Trihatmodjo, a
\nson of former president Soeharto.<\/p>\n
Marubeni, the largest foreign shareholder (21.2 percent) also
\nled a consortium providing millions of dollars in loans to
\nChandra Asri.<\/p>\n
The Indonesian Bank Restructuring Agency (IBRA), a unit of the
\nfinance ministry, took over Chandra Asri after the company failed
\nto repay some Rp 2.92 trillion (US$371.97 million) in loans to
\nseveral domestic banks.<\/p>\n
Chandra Asri is one of IBRA's largest debtors. The agency has
\ntaken over some Rp 200 trillion worth of bank nonperforming loans
\nin a bid to restructure the country's banking system.<\/p>\n
The FSPC took over the Chandra Asri case, after IBRA failed to
\nreach an agreement with Marubeni on how to restructure the
\ncompany's debts, and how to dispose of Chandra Asri's assets.<\/p>\n
The Japanese creditors have reportedly demanded the Indonesian
\ngovernment take over Chandra Asri's debts as a condition for a
\ndebt restructuring deal. But the government has so far rejected
\nthe proposal.<\/p>\n
Experts have said that the government had to handle the
\nChandra Asri case carefully in order to maintain a good
\nrelationship with Japan, which is a major creditor of Indonesia.<\/p>\n
BP Amoco PLC of the UK was reported late last year to be
\ninterested in buying a significant stake in Chandra Asri once the
\ngovernment had reached a debt restructuring agreement with
\nMarubeni.<\/p>\n
IBRA has a mandate to raise proceeds through the sale of its
\nvarious assets to help finance the state budget.<\/p>\n
BP Amoco Chemicals Indonesia was seeking to merge Chandra Asri
\nwith its local polyethylene plant PT Petrokimia Nusantara
\nInterindo. (rei\/prb)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/gus-dur-marubeni-boss-to-decide-chandra-asris-fate-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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