Bukaka gets 75% discount on foreign debt payment: Imron

Bukaka gets 75% discount on foreign debt payment: Imron

JAKARTA (JP): Publicly listed engineering and construction
design firm PT Bukaka Teknik Utama said that its creditors had
agreed to provide a "haircut" or discount of up to 75 percent on
its foreign debt payment.

Imron Zubaidy, the vice president of Bukaka said that with the
haircut, the company would pay only 25 percent of its total
foreign debts, worth US$142 million (around Rp 1.40 trillion),
owed to 39 foreign banks and other international institutions.

"With the agreement, Bukaka is required to pay only 25 U.S.
cents for every dollar of its foreign debts," Imron was quoted as
saying by Antara on Friday.

Imron said Malaysia's Golden Tower Company had signed a
memorandum of understanding (MOU) to take over Bukaka's
obligations to the overseas financial institutions.

If the Malaysian went ahead with the deal, it would spend less
than $35 million to settle all of Bukaka's foreign debts, Imron
said.

He acknowledged the Malaysian company still awaited an
improvement in the country's political situation before entering
with more detailed agreements.

According to Imron, the two companies had yet to decide
whether the Malaysian company's capital injection would be
converted into assets or equity.

Aside from its foreign exchange debts, the company also had
debts worth Rp 71 billion owed to the Indonesian Bank
Restructuring Agency (IBRA).

Imron said the IBRA had in principle agreed to reschedule the
company's debt to between eight and 10 years.

"We hope the restructuring plan can be completed by the end of
this year," Imron said.

After the settlement of all debts, the company planned to
focus its operations on oil and gas, and telecommunications
sectors, Imron said.

Bukaka Teknik Utama, which is partly owned by PT Bukaka
Investindo, suffered a massive loss of Rp 700 billion last year,
down steeply from Rp 14.5 billion in net profit in the previous
year. The massive loss resulted mainly from swollen interest
payment on its foreign debts, following the massive depreciation
of the rupiah against the U.S. dollar last year. (03)