Indonesia govt appeals Bakrie debt restructuring

07 Jul 2015
00:00
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The Indonesian government has filed an appeal against Bakrie Telecom's debt restructuring seeking for the operator's debts to the government to be excluded from the program.

The government is appealing on the grounds that it was not informed of the restructuring process or involved in the decision maker, minister of communications and IT Rudiantara toldReuters.

As a result, the government is requesting that debts to the state are not included in the restructuring, meaning they would need to be paid separately.

While 94.5% of Bakrie Telecom's creditors approved the debt restructuring proposal, some bondholders have complained that they will be receiving only a fraction of the money owned as a result of the vote. The government has joined the list of dissatisfied creditors.

But according to a lawyer representing investors who had filed a lawsuit over the restructuring, if the Supreme Court overturns the original Jakarta Court decision on Bakrie's restructuring, the plan will be deemed to have failed and Bakrie will be placed into bankruptcy and liquidated.

This would result in a greater return for the bondholders compared to if the original decision is upheld, but would mark the end for Bakrie Telecom.

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