Tirtamas granted six months to settle debts<\/p>\n
JAKARTA (JP): The Jakarta Commercial Court rejected on Monday
\nthe demand from the Indonesian Bank Restructuring Agency (IBRA)
\nto declare PT Tirtamas Comexindo bankrupt, granting instead the
\ntrading company six months to settle its debts.<\/p>\n
The verdict was seen as a blow to IBRA's bid to liquidate
\nTirtamas Comexindo through the bankruptcy suit as shock therapy
\nfor other \"uncooperative\" debtors.<\/p>\n
IBRA, representing now liquidated Bank Tamara, filed a
\nbankruptcy suit against Tirtamas in late December, following the
\ncompany's failure to repay Rp 38 billion (US$5.2 million) in
\noverdue loans to the closed bank that have been taken over by
\nIBRA.<\/p>\n
The court's ruling will extend the debt payment suspension
\nperiod for six months as the temporary 45-day suspension of
\npayment asked for by Comexindo in January expired on Monday.<\/p>\n
Chief judge Mahdi S. Nasution cited Tirtamas' good faith in
\nnegotiating a debt settlement, and the yet unclear status of its
\ndebts to its creditors as the court's main considerations behind
\nits decision.<\/p>\n
IBRA currently manages bad debts taken from closed,
\nnationalized and recapitalized banks. Comexindo, the trading arm
\nof the Tirtamas group that is controlled by Hashim
\nDjojohadikusumo, owes an estimated Rp 1.5 trillion in debts to
\nIBRA and to several other creditors.<\/p>\n
The verdict was reached while IBRA and other creditors were
\nscheduled to vote on Monday (yesterday) on whether to accept
\nTirtamas Comexindo's debt restructuring proposal or to go ahead
\nwith bankruptcy proceedings.<\/p>\n
However, the court canceled the voting as the creditors were
\nunable to verify Comexindo's total outstanding debts of some Rp
\n1.5 trillion, owed to various local and foreign banks.<\/p>\n
Tirtamas' legal advisor Hotman Paris Hutapea said IBRA lost
\nthe case, partly because it failed to attend meetings with
\nComexindo and its creditors, aimed at verifying Comexindo's
\ndebts.<\/p>\n
\"This is a lesson for IBRA not to underestimate legal
\nprocedures and skip creditors meetings, since it was IBRA itself
\nthat brought this case to court,\" he told reporters following the
\nruling.<\/p>\n
Based on the 1998 Law on Bankruptcy, Comexindo exercised in
\nlate January its right to request a 45-day period of debt payment
\nsuspension in order to negotiate its debts with creditors.<\/p>\n
Comexindo proposed to use all of the proceeds from its
\ncollected receivables, amounting to $121 million, to repay its
\ndebts. In addition it pledged to repay its debts with $100
\nmillion in annual revenue expected within the next three years.<\/p>\n
Hotman said that since IBRA skipped two recent meetings with
\nComexindo it was not in a position to claim that Comexindo had
\nnot shown good faith in its debt negotiations.<\/p>\n
\"If Comexindo had no intention of repaying its debts, why in
\nthe first place did we ask for a suspension of debt payments?\"
\nHotman questioned.<\/p>\n
If Comexindo did not want to settle its debts it would have
\nsimply sought bankruptcy by itself, he added.<\/p>\n
Companies requesting a period of debt payment suspension are
\nallowed a maximum of 270 days or nine months to negotiate debt
\nsettlement with creditors.<\/p>\n
However, if the debt payment suspension period ends, the
\ndebtors will automatically be declared bankrupt, with no right to
\nappeal to the Supreme Court.<\/p>\n
IBRA's litigation head, Widodo Mudjiono, expressed his regret
\nover the ruling, arguing that it was clear Comexindo had lacked
\ngood faith from the outset.<\/p>\n
\"A gesture of good faith should be demonstrated by making an
\ninitial payment ahead of the debt restructuring negotiations, but
\nComexindo refused to do so,\" Widodo said.<\/p>\n
According to him, IBRA insisted that Comexindo pay up 10
\npercent of its outstanding debts to IBRA but the company ignored
\nthe request.<\/p>\n
He said IBRA would no longer file a litigation case against
\nComexindo, preferring to wait it out until Comexindo took
\nconcrete measures within the 6-month period it was granted to
\nsettle its debts.<\/p>\n
He said IBRA was still hopeful that Comexindo would eventually
\npay its debts.<\/p>\n
Comexindo's case was the second blow suffered by IBRA after
\nthe same court rejected in January its bankruptcy suit against PT
\nWest Kalindo Pulp Papermill, which was owned by businessmen Thee
\nNing Khong and Hasan Basuki. IBRA represented Bank Rakyat
\nIndonesia in the suit. (bkm)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/tirtamas-granted-six-months-to-settle-debts-1447893297",
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