Indonesian govt intends to go after BTel debt

13 Jul 2015

IndoTelko reports that the Indonesian government intends to collect Bakrie Telecom (BTel’s) outstanding debt for frequency usage fees (known locally as BHP) currently totalling IDR1.2 trillion (USD90.2 million). Kalamullah Ramli, the director general of the Ministry of Communications and Information Technology (MCIT), told the news journal: ‘Our position as directed by the minister is still to collect debts from Bakrie Telecom. Currently the matter is being handled by the SDPPI legal department and PPI.’

The under pressure operator has a total debt liability of IDR11.3 trillion, comprising its outstanding BHP fees, unpaid universal service obligation (USO) contribution (IDR1.26 trillion), business debt (IDR2.40 trillion), tower leasing fees (IDR1.30 trillion) and debt proceeds from senior notes totalling IDR5.40 trillion. Further, it also has affiliated debts of IDR73.7 billion, derivatives debt (IDR185.3 billion), guaranteed debt (IDR625.4 billion) and IDR2.6 billion of vehicle financing to pay.

BTel recently received court approval concerning its petition to formally suspend its debt payment (i.e. PKPU), enabling it to move ahead with plans to restructure debt worth IDR4.6 trillion in two schemes. However, last week CommsUpdate reported that the Communication and Information Technology Minister Rudiantara has appealed to the country’s Supreme Court as it seeks to overturn BTel’s debt restructuring plan. The telco, part of the heavily indebted Bakrie Group, confirmed and agreed the restructuring proposal last year that was subsequently approved by the commercial court in Jakarta. Although 94.5% of its creditors moved to back the proposal, some bondholders said they were excluded from the process and, as such, would receive only a proportion of their money as a result of the decision. Bakrie Telecom owes licence and frequency rights fees to the government, which did not get to vote on the restructuring proposal, Rudiantara told Reuters. ‘During their restructuring process, we were not informed, we were not involved,’ the minister said. ‘We request that their debt to the government is not part of the restructuring.’ The ministry has now filed a reconsideration to review BTel’s debt restructuring to the Supreme Court, throwing the telco’s plans into chaos.

Indonesia, Bakrie Telecom (BTel)