Merpati seeks cooperation with regional govts
Merpati seeks cooperation with regional govts
Ailing state-owned air carrier PT Merpati Nusantara Airlines
plans to expand its services in remote areas around the country
by cooperating with local administrations to provide airplanes
that can be operated by the airline.
Merpati president director Hotasi Nababan said the airline had
already inked a deal with Merauke regency in Papua to operate an
airplane to link people in the area to other cities in Papua and
other islands.
Merauke is the country's easternmost regency, located along
the southern part of the border with Papua New Guinea.
"We have begun a revenue-sharing scheme with the Merauke
administration. They provide the airplane and we operate it. We
expect to cooperate in a similar manner with other local
administrations," said Hotasi on Monday.
Hotasi said the Banyuwangi administration, along with some
others, on Sumatra were expected to finalize such a deal soon.
Merpati is having difficulties expanding its fleet using their
own funds, due to a lack of working capital amid soaring debt.
At present, Merpati has Rp 1.3 trillion (US$144 million) in
debts and assets worth about Rp 775 billion. Its major creditors
include the government (Rp 225 billion), Bank Mandiri (Rp 230
billion) and Garuda (Rp 246 billion).
The new government is currently in the process of seeking the
best options for restructuring Merpati. The previous government
and lawmakers had already decided on a "life-saving" scheme,
which consists of strategic sales of assets, an initial public
offering and a debt-to-equity conversion.
The current government is unlikely to continue with that
scheme, however, as the policy of President Susilo Bambang
Yudhoyono, in general, is to refrain from the sale of state
assets, especially those that have strategic value, such as
Merpati.
Aside from making profit for the state, Merpati also has an
obligation to serve remote areas of the country, which are
typically shunned by private airlines due to the low
profitability.
-- JP