IBRA debtor asks for time to negotiate debts

JAKARTA (JP): Facing a bankruptcy suit from the Indonesian Bank Restructuring Agency (IBRA), PT Mustika Niagatama Nusantara has asked the Jakarta Commercial Court to give time for the company to negotiate debt rescheduling terms with its creditors.

In a statement submitted to the court on Monday, Mustika Niagatama proposed a 30-year rescheduling of its debts, with a five-year grace period as part of the debt restructuring program.

The company stressed that during the five-year grace period it should not have to pay interest or installment payments on principal debt.

"Then beginning in the sixth year (of the debt restructuring program), the company will service its debts every six months," the company said.

IBRA filed bankruptcy suits in early July against four companies for failure to pay their matured debts (maturity between February 1998 and September 1998).

The four companies are PT Mustika Niagatama Nusantara with matured debts amounting to Rp 82.5 billion, PT Landasan Terus Sentosa (Rp 270.1 billion), PT Indoland (Rp 3.3 billion) and PT Citra Mahkota Abadi (Rp 103.2 billion).

Landasan Terus Sentosa earlier asked the commercial court to allow time for debt negotiations with its creditors.

In filing these bankruptcy suits, IBRA acted on behalf of the now closed Bank Mashill, Bank Bali and Bank Danamon which provided the loans to the above four companies.

In a separate case, publicly listed cocoa processing company PT Davomas Abadi asked the commercial court to supervise debt restructuring negotiations with its creditors.

Still in another case, prominent businessmen Adi Gunawan and Kim Johannes Mulia also asked the Jakarta Commercial Court on Monday to reject the bankruptcy suit filed by Japan-based Irie Lumber Pte. Limited and Singapore-based Century Wood Product Pte. Limited

Ratna, lawyer for the two prominent businessmen, said the law suit which claimed that her clients were liable for repaying US$800,000 matured debts to the two foreign companies did not have legal back-up as there was no valid agreement supporting it.

In November, last year, Adi took over debts worth US$1.2 owed by PT Polwood Forest Industri (PFI) and PT Polyub Swadaya Utama (PSU) to the foreign companies, with Kim acting as a guarantor. Some of the debts had been repaid.

"When this was done, there had been no formal statement made by the creditors (Irie Lumber and Century Wood) that PT PFI and PT PSU were no longer their debtors and did not owe them anything," she said. (udi/ylt)