Rise and fall of Tommy's business empire

Berni K. Moestafa, The Jakarta Post, Jakarta

In 1984, at the tender age of 22, the youngest son of then president Soeharto, Hutomo "Tommy" Mandala Putra, set up his first company, unleashing an invasion of this country's business world led by PT Humpuss.

Humpuss swelled into an empire that covered the transportation, financing, electronics, telecommunications, construction, oil, petrochemical, retail, and automotive sectors.

Reportedly Soeharto's favorite son, Tommy's swift, all- conquering ascent gave rise to suspicions that he had used his status to further his ends.

Humpuss first moved into electronics and later expanded into the more lucrative trading and transportation sector.

Through Perta Oil Marketing, Humpuss supplied state oil and gas company Pertamina with imported fuel and crude oil, tapping profits from rising domestic fuel demands.

PT Humpuss Intermoda provided Pertamina with ships for the transportation of liquefied natural gas (LNG) under long term contracts.

With capital aplenty, Humpuss went on an acquisition binge, taking over firms in the telecommunications, retail, construction and automotive sectors.

In what may have marked the peak of Tommy's business career, he paid the U.S.-based Chrysler Corporation some $100 million in 1993 for Lamborghini's auto manufacturing plant.

Tommy also gained access to projects that affected the national interest.

He headed the Clove Marketing and Buffer Stock Agency (BPPC), which regulated the price and production of cloves.

Set up in 1991 to protect farmers from volatile clove prices, the agency was instead criticized as damaging the interests of farmers.

But many see Tommy's biggest flop as being the national car project.

In 1996, Soeharto appointed Tommy's PT Timor Putra Nasional (TPN) to develop the project through the importing of Korean cars.

TPN's cars were exempted from import duties and luxury tax, a facility that drew the ire of the World Trade Organization (WTO).

The WTO then ordered Indonesia to scrap the project, leaving TPN owing $521.5 million in debts to local banks.

When Soeharto's presidency fell in May 1998, a wave of corruption charges hit businesses with ties to his family.

It sparked mass cancellations of contracts awarded to Soeharto's family and cronies.

Among the Humpuss companies whose contracts Pertamina scrapped were Perta Oil, Humpuss Trading, PT Katalis Indopratmana, and PT Argamulya Buana Tirta.

Now with Tommy in jail, Humpuss must prove whether it can do without the once influential Soeharto ties.