Indonesian cabinet to decide on Texmaco future on Thursday

11 November 2003 06:38  [Source: ICIS news]

JAKARTA (CNI)--The Indonesian cabinet is expected to make a final decision on the future of the troubled integrated polyester and engineering company Texmaco this Thursday (13 November), a source at the Indonesia Bank Restructuring Agency (Ibra) told CNI on Tuesday.

Cabinet was originally scheduled to decide on the future of the group on Monday, but postponed its decision on what to do with the indebted company until later in the week.

Marimutu Sinivasan, formerly Texmaco's leading shareholder, and the group's 50 000 workers are hoping the government will bail out the company with $100m in working capital.

The bail-out plan is one of four options that has been prepared by Ibra - the other three being another attempt to sell  the group's assets, a second restructuring or some kind of  legal settlement.

The assets of the group, which has debts of Rp29trn ($3.34bn/Euro2.91bn) were taken over by Ibra in the late 1990s during the Asian economic crisis. Sinivasan also owes Ibra Rp1.32trn in private debts as liabilities for his controlling interest in the now defunct Putra Multikarsa.

After restructuring of Texmaco, Ibra now controls a 70% stake in PT Bina Prima Perdana, a new company it set up  to control all of the group's chemical and textile business. Ibra's stake in Bina Prima was not put up for sale.

Bina Prima controls Texmaco's vertically integrated polyester business, including a 340 000 tonne/year purified terephthalic acid (PTA) plant operated by listed Polysindo Eka Perkasa which supports the group's downstream operations in fibres and textiles.

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