Polysindo not to make interest payments on notes<\/p>\n
NEW YORK (Reuters): Polysindo Eka Perkasa will not make
\ninterest payments on over $600 million in outstanding Yankee debt
\nissues, an official at the struggling Indonesian textile company
\ntold investors on Monday.<\/p>\n
The prices of the company's three Yankee issues fell eight to
\n10 points in reaction to the announcement, which was made in a
\nconference call to investors, a trader said.<\/p>\n
The bonds fell to 24-28 from the mid to high 30s following the
\nnews.<\/p>\n
Polysindo will be unable to make the interest payments because
\nthe Asian economic crisis has had a devastating impact on the
\ncompany's financial position in recent months, said Steve
\nSimpson, the company's financial advisor.<\/p>\n
\"You're all aware of the crisis we've experienced in Indonesia
\nand the impact is clearly catastrophic,\" Simpson said during the
\nconference call.<\/p>\n
Polysindo will not make interest payments due June 15 on
\nsenior secured guaranteed notes due 2001 and 2006. The company
\nsaid it will also not make payments due in late July on senior
\nsecured guaranteed notes due 2007.<\/p>\n
One analyst said the semi-annual interest payments for the
\nthree Yankee bonds total around $35 million.<\/p>\n
Simpson said Polysindo officials will visit the United States
\nnext week to appoint a financial advisor and to meet with lawyers
\nas well as bondholder trustees.<\/p>\n
Separately, the company also announced that it had
\nsuccessfully rolled over $127 million out of a total of $457
\nmillion in total short-term debt outstanding as of June of 1998,
\nan analyst said.<\/p>",
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"sponsor": "Okusi Associates",
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