IFC will retructure loans to Hotel Santika Nusajaya
IFC will retructure loans to Hotel Santika Nusajaya
JAKARTA (JP): The International Finance Corporation has agreed
to restructure the debt of PT Hotel Santika Nusajaya, the
property division of media giant Kompas Gramedia Group.
The IFC -- the private investment arm of the World Bank --
said in a statement released Thursday in Washington that the debt
restructuring should "help Hotel Santika Jakarta to recover from
the crisis with improved debt servicing capability."
Sami Haddad, IFC associate director for South and Southeast
Asia, said in the statement that the deal should strengthen Hotel
Santika's financial position "enabling it to better withstand the
current economic crisis and lead the way to similar
restructurings of other sound companies, a key to the recovery of
Indonesia's corporate sector."
Hotel Santika Nusajaya is owned by PT Grahawita Santika, a
hotel chain established in 1981 that operates nine hotels in
Indonesia, including four-star Hotel Santika Jakarta on Jl. K.S.
Tubun, Central Jakarta.
Hotel Santika Nusajaya obtained in 1996 US$27 million in loans
from IFC and other international lenders to build Hotel Santika
Jakarta.
Of this $27 million, IFC provided $14 million with a 10-year
maturity, the Asian Finance and Investment Corporation -- an
affiliate of the Asian Development Bank -- gave $3 million with
an eight-year maturity.
Other creditors -- Deutsche Investitions und
Entwicklungsellschaft GmbH of Germany and the Nederlanse
Financiering-Maatschappij Voor N.V. of the Netherlands --
provided $5 million each.
The deal marks a breakthrough of sorts for the IFC, which has
a $1 billion investment portfolio in Indonesia, currently spread
over 42 companies. The portfolio consists of $150 million in
equity investment and $850 million in debt financing.
Out of the $850 million debt, only about $350 million comes
directly from IFC's own pocket -- the rest is in loans made by
commercial banks in IFC's name.
According to Dow Jones Newswires, IFC believes about $100
million to $150 million of its debt financing extended to
Indonesian companies is at risk of not being fully recovered.
The organization recently suffered a setback in its debt
recovery campaign when the Supreme Court rejected an appeal by
the IFC and other foreign creditors to declare PT Dharmala
Agrifood bankrupt, dealing a further blow to the country's
struggling bankruptcy law.
The IFC together with PT ING Indonesia Bank and Indonesia's PT
Bank Niaga, filed an appeal petition to the Supreme Court after
their initial bankruptcy claim against the listed Indonesian
agricultural food producer was thrown out by the Jakarta
Commercial Court in early December. (rid)