Ometraco Multi Artha declared bankrupt

Ometraco Multi Artha declared bankrupt

JAKARTA (JP): The Jakarta Commercial court declared PT
Ometraco Multi Artha (OMA), a multifinance arm of the publicly
listed PT Ometraco Corporation, bankrupt on Friday after its 28
creditors rejected the company's debt restructuring proposal.

Chief judge Haryono said that the bankruptcy decision, the
second issued by the court since its opening in September, was
made because debtor and creditors failed to reach agreement on
the debt restructuring.

The court issued a temporary suspension of payments to OMA
late September for 45 days and urged the company and its
creditors to negotiate a debt rescheduling program during the
period.

According to the new bankruptcy law, which was enacted in
August, the court will issue a permanent suspension of the
payment order if creditors and debtors succeed in debt
negotiations but if they fail, the debtor will be declared
bankrupt.

"The court turned down the proposal for a permanent suspension
of payment by OMA and declared it bankrupt," Haryono said.

He also appointed supervisory judge Victor Hutabarat and
curator William Edward Daniel of Warens & Achyar to take care of
OMA's assets before the company is liquidated.

He ordered the firm to pay a five percent fee (of total
assets) to the curator.

Daniel said that OMA, which has a total debt of US$178.5
million debt to its creditors, has total assets of Rp 500 billion
(about $66 million)

Lawyer Kitty Sugondo Kramadibrata, who represented three
foreign creditors, said Friday that the court had made a wise
decision.

"I think the decision is fair as OMA did not show its best
efforts to settle its mounting debts with the creditors during
the temporary suspension of payment period," she said after the
hearing.

Haryono said that the multifinance firm could not appeal to
the Supreme Court to nullify the court's ruling as the existing
law does not allow it to do so.

According to the bankruptcy law, a debtor can only appeal if
it does not require a temporary suspension of payment.

In a most controversial ruling early last month, the Jakarta
Commercial court declared property firm PT Modernland Realty,
with assets of more Rp 1 trillion, bankrupt for its failure to
pay a petty claim worth Rp 94.13 million (about $12,500) to two
Indonesian property buyers Hussein Sani and Johan Subekti.

Bankruptcy lawyers criticized that court's decision as unwise
as it was made when both the plaintiffs and the property firm
were still working on debt renegotiation.

Modernland has proposed an appeal to the Supreme Court to
nullify the decision, and this is expected to be made in within
next few weeks. (aly)