Bakrieland's creditors agree to restructure foreign debt

JAKARTA (JP): Publicly listed property firm PT Bakrieland Development, a property arm of the Bakrie Group, has successfully restructured part of its US$15.7 million foreign debt, its president said yesterday.

Bambang Irawan Hendradi said South Korean Dong Nam Diamond Finance Company had recently agreed to roll over its $1.4 million loan to his company, due this year, to five years and six years.

He also said Bakrieland was negotiating for the rescheduling of the remaining $14.3 million debt with other foreign creditors.

"We hope that we can reschedule the payment of the debts to 2003 from 2001 as scheduled originally," he said.

Bambang said debt restructuring talks with foreign creditors were expected to bear positive fruit as most creditors understood the condition of the country's crisis, which has hit most companies.

He said that since bilateral talks with overseas creditors would bring a positive outcome for the company, it was not necessary for Bakrieland to join the newly established Indonesian Debt Restructuring Agency (INDRA).

INDRA, which will begin operations Aug. 3, will help Indonesian cash-strapped companies settle repayment of their offshore debts.

Bambang said the property firm had Rp 9 billion debt in domestic Bank Panin.

"We have also made negotiations with the bank as part of the restructuring plan."

Bambang said that as part of the efforts to survive the country's worst-ever crisis, the company would also sell several of its subsidiaries, especially those which recorded losses in the previous year.

"Selling unprofitable units is part of our efficiency program," he said.

Bambang said the restructuring plan was expected to boost the performance of the company, which suffered a net loss of Rp 33.18 billion last year, largely due to large foreign exchange losses.

The company booked operating profits of Rp 7.74 billion last year, up 177 percent from Rp 2.79 billion in the previous year, he said.

He declined to project the company's earning and sales this year.

Total assets swelled to Rp 1.11 trillion in 1997 from Rp 267.73 billion in 1996.

Bakrieland acquired assets of its affiliates, PT Krakatau Lampung Tourist Development Center, PT Bali Nirwana Resort and PT Graha Andrasentra Propertindo in September last year.

"The company spent around Rp 469 billion to acquire the companies' assets," he said, adding that funds to buy the assets of the three companies were derived from proceeds of the company's limited public offering last year. (aly)