PT Bakrie & Brothers, the holding company of Indonesia’s politically wired Bakrie Group, said it was considering repaying or restructuring a $597 million loan from Credit Suisse in the “near future” as the lenders called in the loan.
The group, controlled by the family of Indonesia’s Golkar Party Chair Aburisal Bakrie, took a $1.35 billion loan from Credit Suisse in March, using a stake in its London-listed Bumi Plc, formerly known as Vallar, as collateral.
Bakrie & Brothers, as a part of the Bakrie conglomerate, took a $601 million loan, while unlisted Long Haul Holding, which is also controlled by the Bakrie family, took the rest of the Credit Suisse loan.
Bankers with knowledge of the matter said Bakrie Group will not let go its control over Bumi Plc, its crown jewel, despite the loan issue. The bankers declined to be identified because they are not authorised to talk to the media.
The group would be restructuring a loan for the first time since the 2008 crisis when it struggled to repay $1.3 billion of debt. It had to turn for help to US private equity firm TPG-affiliated Northstar Pacific, Ancora Capital and Brentwood Ventures.
“The company is currently studying the best option to realise it and in talks with related parties,” Bakrie & Brothers said in a statement.
Bumi Plc’s shares, which closed at 710.5 pence on Wednesday, have plunged 38 percent from their June 28 debut in London.
Bakrie Group and the Rothschild banking dynasty joined forces in November last year for Vallar to get a 25 percent stake in Bumi and a 75 percent stake in Berau Coal Energy.
Bakrie Group owns 54.6 percent in the combined Bumi Plc.
In a note on Monday, Macquarie Capital Securities Indonesia said, “Given recent market and Bumi underperformance, it appears that the company has breached its debt covenants” as it undertook a margin loan based on Bumi Plc and Bumi Resources’ share price.
The lenders may be entitled to enforce the security interest over all Bakrie Group shares in Bumi and take control of the London-listed firm if Bakrie Group defaulted on its obligation to the loan, according to the Bumi Plc’s listing prospectus.
Eddy Soeparno, Bakrie & Brothers’s chief financial officer, said the firm is in talks with investors to settle the matter, but did not give details.
If the group emerges unscathed again, it would be the third time they survived a liquidity problem. Bakrie & Brothers had restructured its debts after the 1998 financial crisis. -By Janeman Latul