Tri Polyta seeks full approval for its debt restructuring

JAKARTA (JP): Publicly listed PT Tri Polyta Indonesia said on Wednesday that 70 percent of its bondholders agreed to its debt restructuring proposal but it still needed to achieve a unanimous approval to make the debt restructuring take effect.

Tri Polyta president Iman Sucipto Umar said the company had to get 100 percent approval of the bondholders as stipulated in the debt agreement between the company and the bondholders.

"The restructuring proposal involves a debt rescheduling, thus, according to our agreement, it must be approved by all the bondholders," he said adding that the company expected to complete the debt restructuring agreement by September.

The Tri Polyta debt restructuring proposal covers a rescheduling of the maturity of its US$185 million bonds from 2003 at present to 2005.

It also covers a temporary revision of the bond coupon rates from the ongoing 11 and 3-8th percent per annum to between 8 percent and 10 percent during the first two years following the signing of the restructuring agreement, according to Iman Sucipto.

In addition, the proposal also offers the bondholders a proportional 15 percent stake in the company if the company fails to fully repay the bond principal by the new maturity year 2005.

Tri Polyta, which is listed on the Jakarta Stock Exchange and was recently delisted from the New York Stock Exchange, issued the U.S. dollar-denominated bonds worth $185 million in the U.S. in 1996. The bonds will mature in 2003.

In servicing the bonds, Tri Polyta failed to pay coupon payments to its bondholders on June 1, 2000, Dec. 1, 1999 and June 1, 1999.

Tri Polyta booked a net loss of Rp 128 billion in the first quarter this year.

In 1999, Tri Polyta booked a net income of Rp 22.3 billion, as compared to a net loss of Rp 589.7 billion the previous year.

The company produced 73,300 metric tons of polypropylene during the first quarter and it expected the total output would reach 250,000 metric tons this year. The amount of polypropylene produced and sold has always been around the same levels, according to Iman Sucipto.

Tri Polyta currently has a negative equity amounting to about 80 percent of its total assets.

It's total assets stood at Rp 2.03 trillion as per Dec. 31, 1999, compared to Rp 2.06 trillion the previous year.

Tri Polyta, with its production base in Cilegon, West Java, has a total capacity of 360,000 metric tons of polypropylene per year.

Polypropylene is plastic resin used as raw material for various packaging applications. (udi)