These are schemes to restructure BUMI debts

JAKARTA. Information has it that according to the management team of postponement of debt payment obligations (PKPU), 80% of creditors have agreed the plan for restructuring the debts of PT Bumi Resources Tbk (BUMI).

Despite the debts’ restructuring should be taken through voting mechanism, the process at least may reflect the result of the voting, which is scheduled on 9 November 2019 at Central Jakarta Commercial Court.

The proposal of the debts settlement mentioned that one of the agreement clauses include the scheme of debt to equity swap with the price of Rp 926,16 per a share. Director and Corporate Secretary of BUMI Dileep Srivastava gave a positive sign about the plan for debt to equity swap.

The debt to equity swap mechanism will involve 11 creditors, such as Country Forest Limited (CFL), Castleford Investment and Axis Bank with a total credit of US$ 1,81billion. The value of debt conversion will be equal with 39.39% of the value of BUMI shares. BUMI is scheduled to issue the shares on 30 June 2017.

Another clause is the release of a worth of US$ 100 million of tradable contingent value rights (CVR) for the creditor of New Senior Secured BUMI. The CVR itself will mature in a five years period since the date of issuance.

The agreement clauses also include the release of a worth of US$ 639 million of mandatory convertible bonds (MCB) for some creditors, namely CFL, Axis, UBS and DBS. The MCB has a 6% coupon rate and will mature in a seven years period since the effective date of the scheme.

Meanwhile, the restructuring clause to the China Development Bank (CDB) stipulates that BUMI will settle 32.24% of the debts with new senior secured facility and/or new note 2021, while others will be settled through tranche C facility. “We will implement the plan after settling the process of postponement of debt payment obligations (PKPU)”, Dileep added.

A source of KONTAN mentioned that the PKPU mechanism offers the best solution. In this case, BUMI cannot settle the debts if the company is bankrupt. “Let alone, the BUMI’s subsidiaries are still productive”, he said.

To date, the team of PKPU has verified a worth of Rp 135.78 trillion debt bills of 270 creditors.

(Muhammad Farid/Translator)