This article has been translated by PwC Indonesia as part of our Indonesia Infrastructure News Service. PwC Indonesia has not checked the accuracy of, and accepts no responsibility for the content.
Bisnis Indonesia, - Restrukturisasi utang BUMN Karya: Kesepakatan terus berdatangan
7 March 2024
By Dinisio Damara
Bisnis, Jakarta – The financial recovery efforts undertaken by state-owned construction companies are making significant progress. Several state-owned corporations grappling with debt have successfully negotiated agreements with their creditors.
The construction state-owned enterprise issuer PT Wijaya Karya (Persero) Tbk successfully established a master restructuring agreement (MRA) with several financial institutions, involving an outstanding value of Rp20.79 trillion.
The outstanding value aligns with its total restructured debt. In February 2024, the issuer identified by the ticker code WIKA established an MRA with four financial institutions, building on the prior agreement with 11 financial institutions.
WIKA President Director Agung Budi Waskito said that the agreement reflected the high level of trust of financial institutions in WIKA.
“The financial institutions believe in the value and the benefits of WIKA. Hence, the establishment of the MRA will positively impact the company’s recovery,” he said on Wednesday (6/3).
Agung emphasised WIKA's commitment to the timely payment of due coupons for bonds and sukuk. On 3 March 2024, WIKA fulfilled this commitment by paying Rp69.6 billion in interest for mature bonds and sukuk mudharabah from Public Offering (PUB) I Phase II Year 2021.
Looking ahead, he highlighted that recovery efforts would run concurrently with the successful completion of projects entrusted to WIKA. Support from stakeholders will also play a crucial role in ensuring the seamless execution of various plans.
Similarly, PT Adhi Karya (Persero) Tbk has obtained approval from its general meeting of bondholders to modify its EBITDA covenant, aligning it with a loan interest adjustment to no less than two to one.
Based on the publication on Wednesday (6/3), the issuer identified by the ticker code ADHI held the general meeting of bondholders on Continuous Bond II Adhi Karya Phase II Year 2019 on 1 March 2024.
The outcome of the meeting endorsed the modification of the EBITDA covenant, setting a loan interest ratio to no less than 2:1.
“Thank you to all bondholders who have supported and approved the proposal to adjust the covenant,” Adhi Karya President Director Entus Asnawi Mukhson said.
Maintaining commitment
He mentioned that, up to this point, ADHI has consistently met its deadlines for paying both due coupons and principal. Going forward, the company remains dedicated to upholding its commitment to fulfilling its obligations.
In addition to modifying the EBITDA covenant, the meeting also resolved that ADHI must uphold its current assets-to-current liabilities ratio, ensuring it remains no less than 1:1.
Meanwhile, the total loan to total equity ratio must be maintained at no less than 3.5:1.
Another construction SOE issuer, PT Waskita Karya (Persero) Tbk (WSKT) reported that all bank creditors have approved in principle the bank loan restructuring scheme proposed by the company.
Besides that, the company’s general meeting of shareholders has also approved the restructuring of the principal and interest settlement scheme for non-guaranteed bonds.
Waskita Karya President Director Hanugroho stated that the restructuring scheme approval marked an important milestone in Waskita’s financial recovery journey, enabling optimal maintenance of its cash flow for a more sustainable operational cycle.
“Our proposal stands as the optimal choice for the company to address Waskita's obligations to all creditors, encompassing banks, bondholders, and vendors,” Hanugroho said a week ago.
In accordance with the approval of bondholders, all bank creditors have also approved in principle the bank loan restructuring scheme proposed by Waskita.
According to him, the approval of bondholders is part of WSKT’s overall restructuring process.
“We hope that we can reach a better agreement between Waskita and bondholders.”
Construction SOEs, such as WSKT and WIKA, are actively involved in projects within Nusantara Capital City (IKN). These two issuers collectively hold contracts with a total value of Rp14.63 trillion for various projects within IKN.
