PT Cipendawa lays off majority of its workers
PT Cipendawa lays off majority of its workers
JAKARTA (JP): Publicly listed poultry producer PT Cipendawa
Farm Enterprise said on Thursday it had laid off 790 of its 946
employees as part of its cost-cutting measures to survive the
hard-hitting crisis.
The company said in a statement sent to the Jakarta Stock
Exchange (JSX) management that the remaining 156 employees would
continue to run the company's business operations.
"The employees and the management have reached an agreement on
the layoffs that has been accepted," the statement said.
The statement said that although the cost-cutting measures
would cause a 62 percent decline in the company's production,
they would save Rp 766 million (US$69,600) in operating costs
this year and Rp 5.22 billion next year.
The company is currently negotiating with foreign investors
from Vietnam, Sri Lanka, Cambodia and Myanmar, the statement
added.
Company president Soekaryo said early this month that the firm
had closed its operations since Aug. 1 and promised to give
severance payments to the employees who were forced to resign.
Although the company did not state the reason for halting its
operations, some analysts said that it was partly due to its huge
foreign exchange debts.
Like all local poultry firms, Cipendawa, which breeds and
raises chickens, has suffered from the soaring price of feed,
most of whose components are imported.
Many second and third-line companies on the local exchange are
currently on the edge of bankruptcy because of their inability to
repay offshore debts caused by the rupiah's 80 percent fall
against the U.S. dollar since July last year.
The rupiah hovered around 11,000 to the American dollar on
Thursday compared to its pre-crisis level of 2,450.
The JSX management said on Thursday that it had resumed
trading in Cipendawa's stocks on the local bourse after a nine-
day suspension.
According to the 1997 Indonesian capital Market Directory,
Cipendawa is 36.75 percent owned by Probosutedjo, the half
brother of former president Soeharto, Ratmani (7 percent), Kasman
Gozali (5.25 percent), Agus Nursalim (5.25 percent), Nurdin
Latief (5.25 percent), Aris Sumatra (5.25 percent), Muljono
Sukohardjo (5.25 percent) and the investing public (30 percent).
(aly)