Habibie, Prayogo confer on Chandra Asri's fate
Habibie, Prayogo confer on Chandra Asri's fate
JAKARTA (JP): President B.J. Habibie summoned business tycoon
Prayogo Pangestu on Thursday to discuss the fate of his company
PT Chandra Asri Petrochemical Center.
Prayogo, reportedly listed as the third largest debtor to
state banks, after former president Soeharto's two sons, played
down the meeting. He said the discussion concerned a
reconstruction project in Mangole Island, Maluku, which was
damaged by an earthquake in December.
Prayogo has a timber plant on the island.
"The President asked me to help rebuild the island, which was
recently destroyed by a quake," Prayogo said after the meeting at
Merdeka Palace.
Habibie was accompanied by Minister of Finance Bambang
Subianto, State Minister of Empowerment of State Enterprises
Tanri Abeng and Minister of Industry and Trade Rahardi Ramelan.
Bambang and Rahardi refused to comment to waiting journalists
after the meeting.
Prayogo, who appeared tense, almost entered Tanri's car, which
was parked next to his BMW limousine.
When a journalist shouted: "What will you do with your
debts?", Prayogo shook his head and said "no, no, no".
Tanri finally revealed the substance of the meeting, only
after providing a lengthy explanation about the progress of the
privatization and profits of several state-owned companies.
"The subject of the meeting was to discuss Chandra Asri's
(value) as quite a strategic industry."
Repayments
Last year, a leading Japanese newspaper, Nihon Keizai Shimbun,
reported that the company asked a consortium of banks for a
three-year moratorium on repayments of a US$830 million loan.
Chandra Asri is a joint venture between Japanese companies
Marubeni Corp and Showa Denko KK, and Indonesian partners
including PT Bimantara Citra, owned by Soeharto's son Bambang
Trihatmodjo, and PT Barito Pacific Timber, owned by Prayogo.
The country's only ethylene producer was set up with the
backing of an investment firm established by Japanese
participants.
The $1.88 billion venture has produced 510,000 tons of
ethylene and 300,000 tons of polyethylene annually since 1995.
Tanri indicated that a government team led by Bambang Subianto
would formulate the policy of Candra Asri's restructure as a part
of real sector development.
"There will be no exception. He (Prayogo) must follow the
rules of the game issued by the ministry of finance."
Tanri confirmed that foreign companies, including a German
firm, had expressed interest in Candra Asri stakes. He said a due
diligence was still underway.
Prayogo, known as one of former president Soeharto's closest
associates, reportedly owes Rp 2.6 trillion ($288 million) to
state banks, the third largest after Bambang Trihatmodjo and his
associates (Rp 1.9 trillion, $2.7 billion) and Hutomo Mandala
Putra (Rp 1.7 trillion, $400 million).
When asked to comment about his huge debts, the owner of the
7.16 percent stake at PT Astra International replied "It is not
news".
His publicly listed Barito Pacific Group owns 2.7 million
hectares of forest concession throughout the country. (prb)