JIHD to restructure $70m in debts

JIHD to restructure $70m in debts

JAKARTA (JP): PT Jakarta International Hotels and Development
(JIHD) and its creditors signed a deal here on Friday outlining
the restructuring of the company's US$70 million in debts, the
hotel operator said on Friday.

Under the agreement, the company's debts will be extended
seven years from the original due date of January 1998, with a
five-year put option.

"At the end of the five-year term the parties will have the
option of either extending the restructuring term or refinancing
the facility," JIHD said in a statement.

Interest rates for the initial three years of the
restructuring vary from between 4 percent and 6 percent, and will
subsequently revert to the London interbank offered rate and an
appropriate margin, it said.

Throughout the restructuring term, lenders will retain their
collateral, which consists of security over the hotel's assets,
including the land, improvements, movable equipment and
receivables.

The agreement was reached after two years of negotiations
between JIHD's management and the syndicate's lead bank, The
Royal Bank of Scotland Plc in Singapore, following an independent
accountant's report prepared by consultancy firm Ferrier Hodgson,
it said.

The debts, which were originally signed in January 1995 and
fell due in January 1998, were used to finance renovations for
Hotel Borobudur.

The statement said the loan would be serviced from surplus
cash derived principally from hotel operations.

JIHD, listed on the Jakarta Stock Exchange, owns the Hotel
Borobudur Jakarta and a property development site in the Central
Business District on Jl. Sudirman, through its subsidiary PT
Danayasa Arthatama. (tnt)