Shareholders meeting of ailing Sempati Air delayed

Shareholders meeting of ailing Sempati Air delayed

JAKARTA (JP): Sempati Air's shareholders meeting scheduled
yesterday to decide the future of the ailing private airline was
canceled because many of the shareholders could not attend.

Sempati spokeswoman Rima Novianti said the new date for the
shareholders meeting had not been fixed. The airline is partly
owned by former president Soeharto's youngest son Hutomo "Tommy"
Mandala Putra.

"Many of our shareholders had not confirmed their presence as
of last night (Wednesday) while some others said that they could
not attend the meeting due to various reasons," Rima told The
Jakarta Post.

Sempati, founded in 1989, is owned by the Malaysian-Indonesian
joint venture Asian Aviation Inc. (40 percent), the Indonesian
Army's PT Tri Usaha Bhakti (Truba) (25 percent), the Humpuss
Group, controlled by Tommy (15 percent), and Soeharto's close
friend Mohammad "Bob" Hasan (20 percent).

She said the company's shareholders were to meet yesterday to
discuss whether it should completely halt operations and
resulting actions to take on workers and fleets.

On Monday, Minister of Communications Giri Suseno Hadihardjono
said Sempati Air would stop operations as rising costs resulting
from the sharp drop in the rupiah against the U.S. dollar had
eaten up most the company's revenues.

Rima said Sempati's flight operations would be halted as of
this Saturday, but administration service would remain to collect
proceeds from agents until the end of June.

"After that we don't know what to do. It depends on the
shareholders meeting," she said.

She said that a sharp plunge in the value of the rupiah
against the U.S dollar had caused serious turbulence for Sempati
since 80 percent of its operating costs were in dollars,
including for lease payments, spare parts purchases and airport
service.

Rima said Sempati operated a fleet of 25 leased aircraft and
employed 3,500 workers at its peak in 1996, a time when it was
labeled the country's largest private air carrier.

Currently, it uses five Boeing 737 aircraft and has about 700
employees. It had slashed its former service to 31 international
and domestic destinations to just seven domestic domestic
destinations.

The five other scheduled air carriers are state owned Garuda
Airlines, Garuda's subsidiary Merpati Nusantara, Bouraq Airlines,
Mandala Airlines and Dirgantara Air Service.

Except for Dirgantara, which only operates its own aircraft,
the carriers lease many of their aircraft. (gis)