Fajar to restructure debts

Fajar to restructure debts

HONG KONG (Dow Jones): Indonesia's Fajar Surya Wisesa said yesterday it will seek to restructure its outstanding debts, totaling at least US$265 million, and ask creditors to accept a moratorium on principal and interest payments until the restructuring is complete.

The maker of industrial paper products said its financial position had been negatively effected by the sharp decline in the value of the Indonesian rupiah against the U.S. dollar and high domestic interest rates that quashed local demand for paper products.

Meanwhile Standard & Poor's credit rating agency said yesterday it had cut its corporate credit rating Fajar Surya to Not Meaningful from Double-C/Watch Negative/minus.

It has also cut its rating to Single-D from Double-C/Watch Negative/minus on guaranteed subsidiary FSW International Finance Co. BV's $135 million 12.5 percent notes due 2006.

These rating actions follow Fajar's announcement that the company is suspending payments on its rated note issue.