Texmaco's creditors show interest in textile assets
The Jakarta Post, Jakarta
The Indonesian Bank Restructuring Agency (IBRA) said on Monday that some of Texmaco's foreign creditors had expressed interest in purchasing the group's textile division, currently on sale under IBRA's sixth and final loan assets sale program.
IBRA deputy chairman Mohammad Syahrial said the foreign creditors were mostly interested in the company's textile assets. The Texmaco Group is Indonesia's largest textile and engineering conglomerate.
"Some foreign creditors have expressed interest, although none have yet registered formally," said IBRA deputy chairman Mohamad Syahrial without elaborating.
Texmaco owes around Rp 29 trillion (US$3.4 billion) to IBRA, which has been trying to sell this loan asset for the past year.
The corporation also owes $89 million to state-owned Bank Negara Indonesia (BNI) and $1.2 billion to foreign creditors, in addition to $52 million in tax, electricity and gas arrears.
IBRA, which previously failed to sell the Texmaco loan assets, is now adopting a different approach, dividing the loan assets into two: loans owed by the textile division and loans owed by the engineering division.
Syahrial said the agency was now more optimistic that the new method would attract more investors.
He did not name which creditors were interested in the Texmaco textile division, but said that Malaysia's Utara Capital, which is co-owned by Mukhriz Mahathir, the youngest son of former Malaysian prime minister Mahathir Mohammad, could still join the bid. Utara participated in the earlier Texmaco tender, but failed to submit a bid in the final round.
The Texmaco Group was founded more than three decades ago and grew quickly to become a leading player in the region's textile and engineering industries. Its textile division produces raw materials for textiles and finished fabrics, while its engineering division makes heavy engines and automotive vehicles, including commercial and military trucks.
Grouping more than 20 subsidiaries, the company plunged into debt following the Asian financial crisis of 1997, prompting IBRA to bail it out.
The Texmaco assets are among the few remaining unsold assets under IBRA.
IBRA's mandate to restructure the country's banking and corporate sector will end in February 2004.
The current sale program, launched last week, is IBRA's third attempt to sell Texmaco assets. Jan. 12 has been set as the deadline for final bids.
The Texmaco assets on offer are in the form of exchangeable bonds, which can be exchanged for company shares of equal value.
The bonds were issued by Texmaco's two main holding companies, textile maker PT Bina Prima Perdana, worth Rp 5.3 trillion and $284.5 million, and engineering company PT Jaya Perkasa Engineering, valued at Rp 5.7 trillion and $1.5 billion).