Bakrie & Brothers confident that 1999 will bring better fortunes
Bakrie & Brothers confident that 1999 will bring better fortunes
JAKARTA (JP): Publicly listed PT Bakrie & Brothers entered
1999 confident its fortunes will pick up after two difficult
years.
Bakrie & Brothers president Irwan Sjarkawi said on Thursday
the conglomerate expected to reach agreement by June at the
latest with international creditors on restructuring its US$1.2
billion foreign debt.
"We hope to restructure all of our debt some time between
April and June. After that, we can expect a kind of cocreation
together with our creditors to nurture our business in the
future," Irwan told The Jakarta Post.
Irwan said part of its offshore debt was repaid in early
December through the sale of 4 million "class I" shares in
Iridium LLC to American International Group Inc.
He said that although most creditors wanted to be repaid as
soon as possible, it would be difficult to satisfy them all due
to the sharp fall in the rupiah.
The rupiah has plunged from Rp 2,450 against the U.S. dollar
in July 1997 to about Rp 8,000.
According to the conglomerate's data, about $400 million of
the debt is in bonds and the remainder in syndicated loans.
Almost half of the debt was hedged, minimizing the foreign
exchange loss potential.
After debt restructuring, Bakrie hoped its businesses would
proceed again normally in line with economic recovery in
Indonesia and the rest of crisis-hit Asia.
"Now inflation is falling, and the market is starting to move.
We hope 1999 will be much better for business, with less
volatility of the rupiah-U.S. dollar exchange rate," Irwan said.
Irwan, who took over the presidency from Tanri Abeng in June,
said he would continue to develop the current core businesses of
infrastructure, plantations and telecommunications.
The only difference, he said, would be to shift the market
from domestic to international to reduce the impact of
uncertainties in the domestic market on its operations.
He said the enterprise last year raked in 60 percent of its
consolidated revenue from the international market, compared to
50 percent in 1997.
"We will continue to focus on the international market. Not
only will it reduce our risks on local uncertainties, it will
also improve our real competitiveness among international
corporations."
By improving its international competitiveness, Irwan said,
Bakrie would be in the forefront when the planned free market
comes into being in 2003.
Domestically, Irwan said, Bakrie & Brothers was also confident
of gaining support from its stakeholders to expand its
businesses.
He said Bakrie was unfazed by recent political developments
because it was founded on hard work, and not corruption,
collusion and nepotism.
Irwan said Bakrie & Brothers would therefore have no problem
in its corporate endeavors regardless of the winner of the June
general election.
"We face the future with confidence as our business is built
together with our customers. We are dependent on our customers
who are at home and abroad, not on any political decisions," he
said. (rid)