Semen Padang asks for Rp 300 billion from Mandiri
Semen Padang asks for Rp 300 billion from Mandiri
The Jakarta Post, Jakarta
State-owned cement producer PT Semen Padang, a subsidiary of
the country's largest cement manufacturer, PT Semen Gresik, has
asked for a Rp 300 billion (US$35.2 million) loan from Bank
Mandiri to refinance its swelling short-term debt.
The president of Semen Padang, Dwi Soetjipto, said the
bridging loan would be used to plug the company's short-term
debt, amounting Rp 560 billion.
"Bank Mandiri has pledged to provide us with a bridging loan
of Rp 300 billion," Dwi was quoted by Antara as saying over the
weekend.
He said the huge debt was accumulated because the previous
management had postponed payments on the company's debt to its
suppliers, while at the same time seeking a new loan from state-
owned insurance firm PT Jamsostek to cover its long-term debt.
He also said some of the loan pledged by Mandiri would be used
to help restore the company's liquidity, which was weakened by a
protracted conflict between its previous board of directors and
stakeholders.
Currently, the company's liquidity is only 70 percent of its
total debts, while its working capital has a deficit of Rp 170
billion.
"A healthy company should have a liquidity ratio of more than
100 percent .... Restoring the company's liquidity has become a
priority because it will be difficult to operate properly without
refinancing," said Dwi.
Dwi took over the leadership of Semen Padang in September this
year after a prolonged struggle by its holding company, Semen
Gresik, to regain control of the firm. Dwi, who was appointed by
Semen Gresik to take over the running of Semen Padang from the
previous management, was only able to enter the firm's office in
Padang, West Sumatra, under the protection of hundreds of police
and military personnel.
Publicly listed Semen Gresik has three subsidiaries: Semen
Gresik, Semen Padang and Semen Tonasa.
The previous directors of Semen Padang, supported by local
politicians and some employees, for more than two years were
engaged in a dispute with Semen Gresik over the government's plan
to sell a majority stake of Semen Gresik to Mexico's Cemex SA de
CV.
They were opposed to a foreign investor controlling Semen
Padang through Semen Gresik, and demanded that Semen Padang be
spun off from Semen Gresik.
Due to the dispute, Semen Gresik had difficulty filing its
2002 financial report because Semen Padang refused to provide its
financial details.
Dwi said one of the company's main tasks was to finalize its
financial report for the 2002 fiscal year so that Semen Gresik
could finish its consolidated 2002 financial report by December,
after missing a September deadline.
However, despite the financial problems, Dwi expressed
optimism the company would reach its sales target of 4.7 million
tons of cement in 2003.
As of October, the company's sales reached 3.87 million tons.