IBRA to issue bonds to bail out ailing companies
IBRA to issue bonds to bail out ailing companies
SINGAPORE (Agencies): The chief of the Indonesian Bank
Restructuring Agency (IBRA) said Tuesday top Indonesian ministers
have given "verbal" approval to issue bonds to bail out 48
companies indebted to IBRA.
"About the 48 enterprises under IBRA, we got verbal or basic
approval from Finance Minister Bambang Sudibyo and Coordinating
Minister for Economy, Finance and Industry Kwik Kian Gie (for)
state enterprise recapitalization," IBRA chairman Cacuk
Sudarijanto said at a news briefing here.
He was here to attend a forum of the Singapore Chinese Chamber
of Commerce and Industry.
The 48 companies owed IBRA some Rp 15 trillion (US$2 billion),
he said.
To speed up debt restructuring, the government will issue
bonds through state enterprises, with the companies using the
proceeds to repay their debts to the banks, he said.
The restructuring of 48 state companies together with around
160,000 small and medium companies must be completed in the next
two quarters.
Once the restructuring is completed, he said IBRA will end up
handling about 1,000 large debtors.
The IBRA chief also defended a decision to replace a key
official, saying the move was aimed at speeding up Indonesia's
asset disposal program.
This week, IBRA had to complete its bank recapitalization
plans, and ensure the successful initial public offering next
month of one of the Indonesian banks, PT Bank Central Asia, he
said.
IBRA has announced plans to sell within the year equity in at
least 20 companies, and a good portion of 1,105 properties or
bank offices, in a bid to raise $5.1 billion by December for the
Indonesian budget. However, he said it will only sell 10 to 15
percent of Bank Central Asia instead of its initial target of
more than 30 percent if the price is not high enough, Cacuk said.
He added IBRA will hold an international roadshow visiting
Singapore, London, New York and four other cities in April.
Cacuk earlier said in a bid to ease its hefty workload, IBRA
plans to farm out the job of restructuring loans valued at
between Rp 5 billion (about $667,000) and Rp 50 billion to
private banks, freeing up IBRA officials to concentrate on
restructuring larger loans.
Agency officials say the IBRA will seek to outsource some
restructuring work to several banks and pay them a fee for
managing the loans as well as a percentage of loans restructured.
Cacuk said IBRA would seek to sell stakes in companies in the
agribusiness, consumer goods, trading and property sectors. IBRA
plans to sell the stakes through a mixture of initial public
offerings and private placements.
IBRA has previously said that around nine of the 20 companies
will be from the Salim Group.
IBRA's efforts to sell assets got a boost last week when it
sold 39.5 percent of its stake in auto maker PT Astra
International to a consortium led by Singapore's Cycle & Carriage
Ltd. The sale is expected to spark other sales to foreign
investors.
In addition, Cacuk said IBRA's short-term priorities include
selling off stakes in state-owned companies and initiating
government-wide restructuring of state companies.