Dharmala Sakti goes bust as debt restructuring opposed

JAKARTA (JP): In an unprecedented event, creditors voted on Wednesday at the Jakarta Commercial Court to bankrupt publicly listed PT Dharmala Sakti Sejahtera after they turned down the latter's debt restructuring proposal.

The vote, which was attended by eligible representatives of almost all Dharmala Sakti's creditors, resulted in 74.97 percent of the creditors approving the move to declare bankrupt Dharmala Sakti, while the rest either opposed the move or abstained.

"The creditors have reached the majority vote to decide the fate of Dharmala Sakti, thus the (Jakarta Commercial) Court will hold a session on Friday or Monday to make an official sentence," the judge supervising the voting process, Syamsudin Manan Sinaga, said.

Joint venture creditor PT Hanil Bakrie Finance Corporation filed a bankruptcy suit in mid-February against Dharmala Sakti for the latter's failure in repaying a US$2.4 million matured debt.

Dharmala Sakti then asked the court to hold off issuing a verdict in the bankruptcy suit filed in order to allow the holding company to negotiate its debt restructuring with the creditors.

In the 1998 Bankruptcy Law such a request is possible as stipulated in its suspension of payment section, which says that a company facing a bankruptcy suit can temporarily halt the action by filing a suspension of payment (locally known as PKPU) request to the court.

If the request is approved, the company is given a maximum of 270 days to negotiate a debt restructuring deal with all of its creditors.

However, the grace period can be ended at any time by a majority vote of the creditors if the borrower fails to show it has the ability and good faith to settle its debts.

Among the biggest creditors of Dharmala Sakti who participated in the voting process were the Indonesian Bank Restructuring Agency, Hong Kong-based Peregrine Fixed Income, currently in liquidation, the Singapore branch of Canadian Imperial Bank of Commerce, joint venture PT AB Sinar Mas Finance and the Jakarta office of Standard Chartered Bank.

Dharmala Sakti is a holding company of Dharmala Group, owned by the Gondokusumo family.

There are five companies affiliated with Dharmala Group that have been declared bankrupt: PT Dharmala Agrifood, PT Putra Surya Multidana, PT Deemte Sakti Indo, PT Putra Sejahtera Persada and foreign affiliate Detron Ltd. of Singapore. (udi)