Salim Group repays 70 percent of IBRA debt
The Jakarta Post, Jakarta
The Salim Group has repaid 70 percent of the Rp 729.4 billion (about US$81 million) it owes the Indonesian Bank Restructuring Agency (IBRA) for the shortfall in assets it pledged to IBRA, an official at the agency said on Tuesday.
IBRA Asset Management Investment head Taufik Ma'ruf said the 70 percent, or Rp 510 billion, was paid in cash, assets and with 2 percent of the total BCA shares, of which Salim still owes 7 percent.
"We'll wait for the remainder, while processing the necessary documents," Taufik said.
The payment was agreed on at a meeting on Monday night -- the deadline Taufik had given Salim to repay its debts.
In total, the group owes IBRA some Rp 58 trillion for bailing out BCA during the 1997 financial crisis.
IBRA injected BCA with recapitalization bonds to replace the bank's depleting assets during the crisis.
Payment on these bonds amounts to around Rp 5 trillion a year and is covered by the state budget.
Salim agreed to repay the debt under the Master of Settlement and Acquisition Agreement (MSAA), under which IBRA has sold off Salim's assets.
Indonesia's once-largest conglomerate unwound several of its most coveted assets, including majority shares in BCA, car manufacturer PT Astra International and in television broadcasting company PT Indosiar Visual Mandiri.
PT Holdiko Perkasa, the holding company managing Salim assets under IBRA, aims to raise another Rp 3.2 trillion from selling remaining assets. These mainly cover properties such as PT Metropolitan Kencana, which owns Wisma Metropolitan and Pondok Indah Mall, real estate at Bumi Serpong Damai and several resorts in Bintan.
These and other assets, however, have over time shrunk in value, although the MSAA does not require Salim to cover the resultant shortfall.
On demands from legislators, the group agreed to pledge more assets and subsequently settled Rp 100 billion of the shortfall in cash before Monday's additional payment.
IBRA has said it wants the shortfall to be paid 60 percent in cash and 40 percent as BCA shares.
The group is believed to have several assets stashed away in neighboring countries. Reports have also surfaced of its plans to purchase a 45 percent stake in Chinese property firm Zhongyuan for $500 million.
There has been no confirmation yet from Salim and IBRA said it was not aware of such a plan, but added the group should first settle its debts to the agency.
The Salim group is one of several debtors whose asset shortfalls, linked to their 1998 debt deals, IBRA has asked to cover.
From them, IBRA has targeted another Rp 6 trillion by year- end, as part of meeting its annual revenue target now set at Rp 42.8 trillion.
So far the agency has sold Rp 16.5 trillion-worth of assets and another Rp 23 trillion through its sales of nonperforming loans that it took over from ailing banks during the crisis.