Summarecon claims US$9m losses from dispute

JAKARTA (JP): PT Summarecon Agung chairman Soetjipto Nagaria said yesterday that his questioning by police was not related to the illegal demolition of a building project in the Tanjung Duren area, West Jakarta, or corruption and embezzlement of funds as reported by the mass media last week.

"I have instead lost US$9 million in equity capital put in PT Swaraeka Prasetia, the owner of the building project, on Feb. 9, 1994," Soetjipto said in a statement.

He said Swaraeka Prasetia was set up on Feb. 4, 1994 -- as a joint venture between PT Summarecon Agung, PT Surya Dewata and PT Atiga Swakerta -- to continue a shopping center project which later became the center of a dispute between shareholders.

Soetjipto made the statement to clarify print media stories last Friday which quoted National Police spokesman Brig. Gen. Da'i Bachtiar as saying that three company executives, including himself, were arrested on charges of illegal destruction of a building, corruption and embezzlement of loans from state Bank Rakyat Indonesia.

Soetjipto recounted that Alie Santoso, the owner of PT Surya Dewata, asked Summarecon to become a shareholder in the shopping center project, Centerpoint, in early 1994 after Surya Dewata failed to complete the project even though it had withdrawn US$13.12 million and Rp 16 billion in loans from Bank Rakyat Indonesia in 1992. The loans were secured by the almost three- hectare plot of land on which the project was built.

However, Taylor Thomson Whiting Indonesia, hired as a consultant for the project, concluded after a study in May, 1994, that the structure of the building project was not technically feasible for a shopping center.

Swaraeka Prasetia's shareholders then agreed on Aug. 10, 1994, to change the project into an apartment building and the change was duly notified to Bank Rakyat Indonesia, according to Soetjipto.

"The original building project was demolished in October, 1995, under the supervision of Alie Santoso. However, we later were embroiled in a dispute over how to proceed with the financing of the project."

He said the shareholders then decided to sell the project's 29,315-square-meter block of land to repay loans to Bank Rakyat Indonesia and hired Colliers Jardine and Knight Frank as the valuer and marketing agent.

"But Alie Santoso later changed his mind and did not agree to the land sales. Suddenly, Summarecon was summoned on March 15, 1997 by the president of PT Surya Dewata, Irvan Gading, to settle the dispute."

Soetjipto said he never knew Irvan Gading because PT Surya Dewata had always been represented by Alie Santoso as the main shareholder.

Irvan proposed that Summarecon pay $11 million to Surya Dewata if it withdrew as a shareholder from PT Swaraeka Prasetia, Soetjipto said.

"Obviously we flatly turned down this groundless request."

He added that Bank Rakyat Indonesia had actually handed over the collection of Swaraeka Prasetia's debts of $22.97 million to the State Receivership Agency on Feb. 16, 1998. (vin)