Bankruptcy suit against Unilever dismissed

Bankruptcy suit against Unilever dismissed

The Jakarta Post, Jakarta

The Central Jakarta Commercial Court dismissed on Friday a
bankruptcy petition against consumer goods manufacturing giant PT
Unilever Indonesia, the company said in a press statement.

The court ruled that PO Parma Djaja had no legal basis to file
the bankruptcy suit because Unilever did not have any outstanding
or maturing debts to the company, a necessary condition for
filing such a petition.

Parma Djaja, a Makassar-based land transportation company,
filed the bankruptcy petition earlier in February in response to
Unilever unilaterally terminating a long-term contract with the
firm in October 1998.

Parma Djaja claimed that there was no substantial reason for
Unilever to terminate the contract, and that the unilateral
decision was unfair.

The company said that because of the contract's termination,
Parma Djaja suffered some Rp 10.2 billion (US$1.15 million) in
financial losses, which included future potential profit and
transportation fees that Unilever was supposed to pay the company
between 1997 and 1999.

Parma Djaja was Unilever's partner in transporting its
consumer products in the Makassar region.

But Unilever said it had strong reason to terminate the
contract, pointing out that several of the company's distributors
had frequently complained about Parma Djaja's poor performance.
Unilever issued several warnings to Parma Djaja but there was
never a response from the company.

Unilever Indonesia started operation in this country in 1934,
and listed its shares on the Jakarta Stock Exchange in 1982. Some
85 percent of the company's stake is controlled by Maatschappij
Voor Internationale Bellengginge, which is based in Rotterdam,
while the remaining 15 percent is held by public investors.