Anwar Sierad needs more time for debt deal
Anwar Sierad needs more time for debt deal
JAKARTA (JP): In an effort to avoid being declared bankrupt,
publicly listed Anwar Sierad asked the Jakarta Commercial Court
on Monday to grant an extra 45 days for the company to continue
negotiations with its creditors, a lawyer said.
Marselina Simatupang of Lucas and Partners, representing one
of the creditors, added that the court would decide on Thursday
whether to grant the request.
"This is not the right legal procedure based on the 1998
Bankruptcy Law. Anwar Sierad should seek approval from the
majority of creditors for an extension, not from the court," she
said.
She said Anwar Sierad had failed to reach a debt restructuring
deal with its creditors by Monday's deadline, thus it should be
declared bankrupt unless the majority of creditors vote
otherwise.
"The creditors do not understand what is going on. We though
we were in court today to vote as stipulated in the Bankruptcy
Law," she complained.
Anwar Sierad was expected to complete the restructuring of its
US$160 million debt within seven and a half months starting from
September as part of the court's suspension of payment (PKPU)
procedure.
The seven-and-a-half-month period elapsed on Monday without a
debt restructuring agreement between Anwar Sierad and its
creditors.
A suspension of payment request, according to the Bankruptcy
Law, allows a company facing a bankruptcy suit to postpone the
suit by filing a PKPU request with the court, subject to the
majority of creditors' approval.
In the suspension of payment procedure, the time given to a
company to negotiate a debt restructuring deal with its creditors
can be extended to a total of 270 days.
If the suspension of payment period ends without a debt
restructuring deal in place, by law the borrower is automatically
declared bankrupt.
Anwar Sierad's finance director Awi Tantra was earlier
reported as saying the company had a debt restructuring proposal
which involved a combination of a debt-to-equity swap (70 percent
of total debts) and debt rescheduling (30 percent).
The debt restructuring proposal, according to the law, has to
be approved by two-thirds of the total of creditors, which
represent at least 50 percent of the total value of the debts.
The company's five biggest creditors representing 50 percent
of its total debts are the Indonesian Bank Restructuring Agency
(IBRA), PT Rabobank Duta Indonesia and Rabobank Asia of Singapore
branch, the Deutsche Bank AG of Germany and Hongkong Shanghai
Banking Corporation.
Anwar Sierad -- 50.01 percent owned by PT Sietek Nusantara
Finance and the rest by the investing public -- is involved in
chicken hatcheries, producing chicken feed and trading in poultry
farm equipment. (udi)