IBRA expects Rp 4 trillion in Salim asset sales

IBRA expects Rp 4 trillion in Salim asset sales

Berni K. Moestafa
The Jakarta Post
Jakarta

Sales of assets formerly owned by the Salim Group may generate
between Rp 3 trillion (about US$288 million) and Rp 4 trillion
for the Indonesian Bank Restructuring Agency (IBRA), as the
agency hopes to sell off the remaining jewels among Salim's
assets.

IBRA deputy chairman for Asset Management Investment (AMI),
Dasa Sutantio said however, it was difficult to expect more out
of the Salim assets.

"It's unlikely that we will be able to get half of our (asset
sales) target from Salim," Dasa told reporters after a briefing
on the sale of Salim's PT Indomobil Sukses Makmur.

AMI aims to sell Rp 8.4 trillion in assets this year to
contribute to the financing of the 2002 state budget deficit.

It has thus far been relying heavily on the sale of the former
assets of Salim Group, which rank among the most valuable under
IBRA.

Among them, have been Salim's large plantations in Sumatra,
television broadcasting company PT Indosiar Visual Mandiri and
Indomobil.

Salim surrendered its assets to IBRA in exchange for the
agency's bail out of its ailing Bank Central Asia (BCA) at the
height of the economic crisis in 1998.

Thereafter, some Rp 52 trillion worth of Salim assets switched
ownership.

Handling the sale of Salim assets is PT Holdiko Perkasa, which
is Salim Group company managed in conjunction with IBRA.

Holdiko has earmarked Salim property assets for sale this
year. Among them are the real estates Bumi Serpong Damai, Kota
Bukit Indah, Cibinong Center Industrial Estate, and several
resorts in Riau, Sumatra.

According to Holdiko finance director Scott Coffey, the top
rating assets include Bumi Serpong Damai, Metropolitan Kencana, a
textile company, and several Salim resorts in Bintan.

But with most of the more valuable Salim assets already sold,
there has been concern IBRA may not be able to sustain large cash
inflows from its asset sales.

Dasa said his AMI division was hoping to see some IBRA debtors
start settling their debts with cash instead of asset transfers.

Debtors paying in cash, would reduce the need for AMI to sell
assets in order to generate cash revenue for its target.

Under the shareholders settlement program, former bank owners
who became IBRA debtors are to surrender their assets or pay in
cash, to settle their debts.

But asset transfers from the former bankers have been
proceeding slowly, and most had yet to start their cash
settlements.

According to Dasa, debtors demanded more flexible terms such
as an extension to the debt payment period from the current four
years to 10 years.

Several of IBRA's largest debtors should be settling their
debts this year, according to the original shareholder settlement
program.

In response to debtors requests, the government granted the
former bankers more flexible debt payment terms, including
tolerating a payment period of up to 10 years.

Dasa explained that the actual payment period depended on
negotiations with each of the debtors.

But he admitted that getting them to settle their debts before
the 10 year limit was difficult, as everyone now knew about
IBRA's time limit.