Agus ready to meet summons over city-owned Bali hotel

JAKARTA (JP): Businessman Agus Rayadi Iskandar di Nata, whose firm has been accused of causing financial losses to a city-owned asset in Bali, said he was ready to face city councilors.

"I'm willing to give any detailed information needed by the councilors on the project," he told The Jakarta Post on Wednesday.

A day earlier, city councilors -- after meeting with an executive of city-owned hotel operator PT Wisata Niaga Jaya -- announced they would summon next week all parties, including Agus, involved in the 1989 deal for the construction of the three-star Kuta Jaya Hotel in the popular tourist area of Kuta, Bali.

The councilors alleged Agus' firm, PT Pura Dita, which had been appointed by Wisata Niaga to operate the 138-room hotel, failed to generate revenue from the business.

Pura Dita, instead, cause Wisata Niaga to become indebted to city-owned Bank DKI in the amount of Rp 5.8 billion (US$833,000), councilors from Commission B on economic affairs said.

"Wisata Niaga was careless in choosing PT Pura Dita for such a project, which basically used city residents' money," Councilor Syarif Zulkarnaen of the United Development Party (PPP) said.

Under the initial agreement, Wisata Niaga, representing the Jakarta administration, provided a 22,000-square-meter plot of land for the project in Kuta, while Pura Dita was appointed to develop and operate the hotel under a 20-year build-operate- transfer scheme, Wisata Niaga financial director Prabowo Soenirman said after Tuesday's meeting.

"In August 1996, the Jakarta administration canceled the deal after the hotel was declared to have suffered total losses of more than Rp 13.5 billion since beginning its operations," Prabowo said.

During the eight year's of the agreement, Prabowo said his company had received nothing from Pura Dita.

"According to the deal, we should have gotten 30 percent of the gross operating profit and another 15 percent of the net profit after taxes," he said.

The hotel is now operated by Bank DKI and all revenue is being used to settle Wisata Niaga's debt.

Agus, whose company earlier declared bankruptcy, said he was curious about the motives of the city councilors in reopening the case, which had been settled with the cancellation of the deal in 1996.

He said the Jakarta administration, through Wisata Niaga, took over the hotel at a very low price, Rp 5.4 billion.

Wish

Agus, the brother of former Bank Duta vice president Dicky Iskandar di Nata, said he had spent some Rp 6 billion constructing the hotel and another Rp 1 billion furnishing it.

"(Under the original deal), I still have 14 years to operate the hotel, but I couldn't do anything because I couldn't pay the debt," he said, adding that he hoped one day to manage the hotel again.

"(If it's possible), I will offer Rp 6 billion to settle Wisata Niaga's debt to Bank DKI. I can easily find financiers. But I'm sure the bank won't let their asset go," he said.

During Tuesday's meeting, Prabowo said he knew nothing about the original agreement between Wisata Niaga and Pura Dita because it was reached before he arrived at the company.

"The current management has nothing to do with it, we only have to clean up the mess," he said.

Agus, however, said Prabowo was involved in the deal from the very beginning as the head of Wisata Niaga's financial department.

"He (Prabowo) was actively involved in the preparations for the project. He knows all the details of the project."

Councilor Ugiek Soegihardjo of the Indonesian Democratic Party of Struggle (PDI Perjuangan) said it was impossible for the hotel to have suffered losses, because he calculated a minimum gross income of Rp 2.3 billion per year if the hotel was only occupied on weekends.

But Agus said there was an oversupply of hotel rooms in Bali when the hotel opened its doors in 1991.

"We had to cut our average room rate from $40 to $25 and offer a 1-for-2 package, which further cut our revenue," he said.

The councilors have not yet decided on the precise date for next week's meeting with the parties involved in the dispute. (05)