BPGS negotiates with IBRA on Mulia and Hilton hotels

BPGS negotiates with IBRA on Mulia and Hilton hotels

JAKARTA (JP): The Gelora Senayan Management Board (BPGS) has
asked the Indonesian Bank Restructuring Agency (IBRA) to seek a
settlement for its debt row with PT Indobuildco and PT Mulia
Intan Lestari, which have leased its land for years.

The Gelora Senayan Executive Directors chairman Yasidi Hambali
said on Thursday that he started to negotiate with IBRA four
months ago to charge both companies with the lease contracts.

"IBRA has set up two programs for the debtors. First, by
putting them in a restructuring program based on their prospects
for the future. If creditors allow their money to be conversed in
shares or there are new investors, the companies can join the
program," he said. "But if both companies don't fulfill the
conditions above, they will be liquidated."

IBRA puts PT Indobuildco, the owner of the Jakarta Hilton
International Hotel and Apartments, as the 32nd largest debtor
with a total debt of Rp 836 billion (US$120.3 million), and PT
Mulia, the management of Hotel Mulia Senayan, is in the 42nd
position of 1,689 debtors with a total debt of Rp 631.1 billion.

PT Indobuildco and PT Mulia are two of five companies which
have yet to fulfill their obligations in paying the leasing fees
to BPGS. The other three companies are PT Graha Sidang Pratama,
the management of the Jakarta Convention Center, PT Gelora
Waskita Karya, whose construction of Senayan Tower had to be
stopped due to the monetary crisis, and PT Manggala Pratama,
which built the BPGS office but failed to build its own project.

Other companies leasing land are PT Kajima Overseas Asia,
which occupies 20 hectares, PT Sinar Kemala Intermetro Golf, 30
hectares, PT Adil Andaru, 5.5 hectares, PT Lingga Hamparan Krida,
4 hectares, PT Rajuli Adi Senayan, 3,300 square meters, and PT
Wantas Perkasa Waya, four hectares.

Yasidi said he preferred to discuss the problem with IBRA
rather than the companies' owners or management. He also said he
did not worry that BPGS would lose its assets.

"Our assets are immobile assets. They are not allowed to be
guaranteed for debt or to be handed over without notification,"
he said.

BPGS, chaired by the state secretary, controls 279 hectares of
land in Senayan, Central Jakarta. Some of the assets are used for
political venues, including the House of Representatives.

Fund

BPGS has earned Rp 150 billion from its lease contracts with
companies since 1990. The fund has planned to build another
indoor stadium in Senayan in 2005.

"We plan to build the stadium to fill the need if we host the
Asian Games. But due to the rupiah devaluation against the
dollar, I think the budget will not be enough to build the
stadium," he said.

Yasidi said some of the budget was used to build sports
facilities in the squash complex, bridge and billiard arenas and
to renovate the shooting range.

Yasidi said the Jakarta administration needed to reconsider
its plan to take over the management of Gelora Senayan.

"The administration has to have a presidential decree for the
takeover due to the provincial autonomy plan. It must also
consider providing Rp 10 billion a year for routine maintenance,
administration, employee allowances, electricity, telephone and
water bills."

Yasidi said BPGS was supporting the sports community by
renting sport venues free-of-charge to organizations and the
National Sports Council (KONI) for holding training programs in
the complex.

"Since last year, BPGS has had a new policy to save some of
our profits to help KONI send athletes to multisport events,
including the 1998 Asian Games in Bangkok, the 1999 Southeast
Asian Games in Brunei Darussalam and the 2000 Olympic Games in
Sydney," he said. (yan)