Government approves Garuda's restructuring

Government approves Garuda's restructuring

JAKARTA (JP): The government has approved Garuda Indonesia's
financial restructuring program and will increase its equity
capital to facilitate the firm's plan to float shares later this
year.

Minister of Transportation Haryanto Dhanutirto told reporters
after installing Garuda's new executives and top echelon
officials at his office yesterday that the government will
increase its equity in the airline by taking over the financing
of seven Boeing aircraft currently operated by the company.

"It's true that the government has scheduled Garuda to float
its shares this year and we have thoroughly prepared the plan, "
he said.

Garuda's financial restructuring program has been approved by
President Soeharto and the Ministry of Finance, he said.

Garuda still has a total debt of Rp 900 billion (US$384
million) for procuring five B-737-400 and two B-747-400 jets
several years ago. The airplanes are now among the 60 aircraft in
Garuda's fleet.

The government, which expects to list three state-owned firms
each year, has so far listed four state-owned companies -- PT
Semen Gresik, PT Indosat, PT Timah and PT Telkom -- on domestic
and overseas stock markets.

Haryanto swore in three executives for Garuda yesterday. They
are Achmad Subianto, who replaced Jazid Adam as the financial
director, Sudarso Kaderi Wiryono as commercial director replacing
Kussuyono and Bambang Wahyudi as technical director replacing
Suratman.

The minister also installed T.B. Jogyanto as inspector general
of the ministry replacing Muslim Masewa, Santo Budiono as
director general of land transportation replacing Soejono, Rear
Marshal R. Sri Diharto as chairman of the Meteorology and
Geophysics Agency replacing Karjoto Santokusumo and Maj. Gen. Ayi
Komaruddin as a ministerial adviser for land transportation
affairs.

Surprising

"This is not a sudden replacement. The replaced officials have
all reached retirement age," Haryanto said, declining to answer a
barrage of questions about what is perceived as a sudden shakeup.

The public relations officers at the Ministry of
Transportation and Garuda, who had no background information on
the new officials, said they had learned about the impending
changes from newspaper reports on Monday.

Kussuyono, who celebrates his 66th birthday today, said that
he learned about the termination of his career at Garuda, which
started in 1960, on Tuesday evening.

Suratman, 53, said he had anticipated his replacement two
weeks ago. He was installed as Garuda's technical director in
1990.

Achmad, who served since 1993 as an expert staff at the Agency
for Technology Assessment and Application (BPPT), replaced Jazid.
Jazid, 64, had been installed in January 1993 as the financial
director to replace Achmad Subianto.

Karjoto, who began heading the Meteorology and Geophysics
Agency seven years ago, said that he was notified of his
replacement on Monday.

Muslim Masewa, 57, was inaugurated yesterday as chief
commissioner of PT Pelni, the state-owned inter-island shipping
firm, after resigning from the transportation ministry.

Masewa and Soejono were widely reported to have been the
sources of allegations made last year to Inspector General for
Development Kentot Harseno that Minister Haryanto was involved in
malfeasance and irregularities.

Kentot made thorough investigations into Haryanto's conduct.
He confirmed many of the allegations in a confidential letter to
President Soeharto late last year.

Kentot's confidential reports to the President were leaked to
the mass media, thereby setting off a nationwide controversy.

President Soeharto later moved to stop the controversy by
declaring the case closed. (icn)

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