Merpati creditors fail to agree on debt settlement – Business

State-owned airline PT Merpati Nusantara Airlines is on the brink of bankruptcy after its creditors failed to agree on a peaceful resolution during the debt deferral request (PKPU) hearing in court on Wednesday of Commerce of Surabaya.

Of its 85 competing creditors, only four rejected a peaceful resolution, while only the finance ministry among its three separatist creditors opposed a peaceful resolution, said Arifin Sulaiman, an official in charge of managing the Merpati PKPU.

“The Ministry of Finance has the greatest credit, so the ‘yes’ voters lost the vote,” Arifin said as quoted by kontan.co.id.

Merpati has total debts of 10.95 trillion rupees ($720.73 million): 1.09 trillion rupees owed to secured creditors, 5.99 trillion rupees to competing creditors and 3.87 trillion rupees to creditors separatists.

Merpati owes the Ministry of Finance Rp2.66 trillion, 68.73% of the amount he owes his separatist creditors. A peaceful settlement would be possible if supported by at least 51% of separatist creditors.

Arifin said the outcome of the vote had no significant impact, as the court would make the final decision.

“The judicial panel will decide whether to declare Merpati bankrupt or approve a peaceful resolution,” he said, adding that the court would issue its decision on Friday.

Meanwhile, Finance Minister Sri Mulyani declined to comment on the ministry’s position in the vote. “Actually, I know the answer, but let the general manager answer,” she said, referring to the general manager of state assets, Isa Rachmatarwata. “But he is [not here] now, so wait for him to come back,” she said. (bbn)