A little more than a month has passed since the Panel of Judges of the Commercial Court of the Semarang District Court decided to grant the lawsuit on Suspension of Debts Payment (PKPU) filed against six companies under the Duniatex Group. Until earlier this week, the team of administrators was reportedly still receiving bills from creditors. The administrators are to report the verification of the bills to the Supervisory Judge on November 8, 2019.\u00a0<\/span><\/p>\n <\/p>\n As we previously reported, two months ago, Duniatex Group\u2019s US$300 million bonds ran into an issue, just four months after BNP Paribas SA and Standard Chartered Plc arranged the sale. Since then, a series of events had happened. It forced six subsidiaries of the Group to face their period of Suspension of Debts Payment (PKPU). On September 25, 2019, Sumitro, the CEO of the Group, filed a voluntary PKPU. The news of the default shocked bonds investors.\u00a0<\/span><\/p>\n In short, problems began to appear when PT Delta Dunia Sandang Tekstil (DDST) (a subsidiary of the Group), who should have paid interest of US$13.4 million on July 10, 2019, for a syndicated loan of US$260 million, was unable to carry out its obligations. The failure then spread. Another subsidiary PT Delta Merlin Dunia Textile (DMDT), who issued global bonds worth US$300 million on March 12, 2019, also failed to pay its first interest of US$12.9 million on September 12, 2019. Things grew worse because other than the global bonds, Duniatex took hundreds of millions USD of syndication and bilateral loan facilities from domestic banks. Indonesian Eximbank and Bank Mandiri have the biggest exposures of Rp3 trillion and Rp2.2 trillion, respectively. Others are Bank BNI, Bank Panin Syariah, Bank Muamalat, BNI Syariah, BRI Syariah, NationalNobu (Lippo Group), and Bank Jabar (BJBR).\u00a0<\/span><\/p>\n Not only that, the companies must also face criminal investigation on allegations of fraud, embezzlement, neglect, and money laundering. The investigation officially started since September 23, 2019, and is being investigated by the National Police\u2019s Criminal Investigation Unit (Bareskrim Polri). The Group of integrated textile companies and properties is believed to have a debt obligation of a total of US$1.33 billion or Rp18.79 trillion from 24 bilateral loans, three syndicated loans, and bond debt.<\/span><\/p>\n On September 11, 2019, one of the Group\u2019s creditors decided to take the issue to court and filed for a PKPU lawsuit. The lawsuit was registered as Case No. 22\/Pdt.Sus-PKPU\/2019\/PN Niaga Smg by PT Shine Golden Bridge and filed against a total of six companies, namely:<\/span><\/p>\n After the hearing held on September 24, 2019, we learned that PT Shine Golden Bridge claimed they have receivables of US$121,000 or equivalent to Rp1.69 billion. On September 30, 2019, as expected, the Panel of Judges decided to grant the lawsuit, and since then, the Group is officially on their temporary PKPU period.\u00a0<\/span><\/p>\n Sumitro, the CEO of the Group, decided to file for a PKPU on himself. The lawsuit was registered as Case No. 25\/Pdt.Sus-PKPU\/2019\/PN Niaga Smg on September 25, 2019. One of the reasons why Sumitro filed the lawsuit is related to what PT Shine Golden Bridge said\u2014that they would hold PT Delta Merlin Dunia Properti (DMDP) responsible and would bring the company to court, although the company is not listed as a defendant in the lawsuit. Sumitro also acted as a personal guarantor for the loans received by several companies. DMDT\u2019s syndicated debt worth US$215 million, for example, is guaranteed privately by Sumitro. In addition, a number of his land also became collateral. On the same day, the Panel of Judges decided to grant the lawsuit against Duniatex Group, Sumitro\u2019s lawsuit was also granted.<\/span><\/p>\n The first meeting of creditors was held on October 9, 2019. In the first meeting, the PKPU administrator, one Alfin Sulaiman, reminded the creditors to register their bills according to the schedule determined to facilitate the PKPU process. The scheme for filing the bills for creditors is divided into groups consisting of foreign banks, local banks, foreign non-bank creditors, and local non-bank creditors. At first, the deadline for filing bills is set to October 16, 2019. By October 31, 2019, the administrators were to verify the registered bills. The peace proposal would be discussed on November 6, 2019.\u00a0<\/span><\/p>\n The creditors’ verification meeting was indeed held on October 31, 2019, but the result of verification was not published. Until November 5, 2019, there were even foreign creditors who still submitted their bills. Per applicable provisions, the Supervisory Judge is the first party entitled to know about the results of the verification, and a report to the Judge will be delivered on November 8, 2019.<\/span><\/p>\n Meanwhile, related to the peace proposal, Fransiscus Alip, the director of AJ Capital Advisory, Duniatex\u2019s financial advisor, had mentioned that they had received various inputs from creditors on the restructuring scheme and various options were considered, ranging from debt tenor extension to shares conversion. If they choose the form of conversion of shares, Duniatex must consider the possibility of an initial public offering (IPO), which means that later, the shares issued will become the property of the creditors. To arrive at a restructuring agreement, Alip estimates that it will take up to five months of discussions.<\/span><\/p>\n However, recently, the legal counsel of Duniatex one Aji Wijaya only said that the initial draft of the peace proposal was submitted to the team of administrators on November 1, 2019, and the contents of the draft were still limited for the creditors.<\/span><\/p>\n Regarding the interconnection loan among the six subsidiaries (who are now the debtors), including bilateral relations between Sumitro (who apparently also has debt but at the same time is the guarantor of the debt of the six subsidiaries), according to Aji they are still reviewing the concepts that can be applied in resolving the maze. The PKPU process is very complicated from the start, so it is not easy to understand. Maybe this is the reason why the Commercial Court at the Semarang District Court decided to hold the trial in a kind of joint session because the interconnection loan mentioned is definitely a crucial part of the process. This is also the reason why in the PKPU trial and process, we can see so many well-known names of advocates involved.<\/span><\/p>\n Imran Nating, for example, represents PT Bank CIMB Niaga Tbk (BNGA), which has a bill of Rp366 billion. The notorious Hotman Paris Hutapea represents PT Bank Rakyat Indonesia (Persero) Tbk (BBRI) and PT Bank BRIsyariah Tbk (BRIS), which has a total bill of Rp2.5 trillion. In a statement given to national media outlets after the bills verification hearing, Hotman said the total bills submitted by all creditors reached over Rp20 trillion. In addition, Sarmauli Simangunsong represented Bank Nobu (and she often represented the Lippo Group in various cases) and Bobby Manalu, who represented PT Bank ICBC Indonesia while PT Bank Mandiri (Persero) Tbk (BMRI) is represented by Swandy Halim.<\/span><\/p>\n Note that Duniatex had received provisional relief from potential bankruptcy from the South New York Commercial Court in the United States after filing for protection under Chapter 15 of the US Bankruptcy Law.\u00a0<\/span><\/p>\n <\/p>\n By Pradnya Paramitha<\/span><\/p>\n Copying, redistributing, and retransmitting this article is a violation of copyrights.<\/i><\/b><\/p>\n","protected":false},"excerpt":{"rendered":" A little more than a month has passed since the Panel of Judges of the Commercial Court of the Semarang District Court decided to grant the lawsuit on Suspension of Debts Payment (PKPU) filed against six companies under the Duniatex Group. Until earlier this week, the team of administrators was reportedly still receiving bills from creditors. The administrators are to report the verification of the bills to the Supervisory Judge on November 8, 2019.\u00a0<\/p>\n","protected":false},"author":311,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":""},"categories":[3],"tags":[],"_links":{"self":[{"href":"http:\/\/yosefardi.com\/wp-json\/wp\/v2\/posts\/83186"}],"collection":[{"href":"http:\/\/yosefardi.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/yosefardi.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/yosefardi.com\/wp-json\/wp\/v2\/users\/311"}],"replies":[{"embeddable":true,"href":"http:\/\/yosefardi.com\/wp-json\/wp\/v2\/comments?post=83186"}],"version-history":[{"count":1,"href":"http:\/\/yosefardi.com\/wp-json\/wp\/v2\/posts\/83186\/revisions"}],"predecessor-version":[{"id":83187,"href":"http:\/\/yosefardi.com\/wp-json\/wp\/v2\/posts\/83186\/revisions\/83187"}],"wp:attachment":[{"href":"http:\/\/yosefardi.com\/wp-json\/wp\/v2\/media?parent=83186"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/yosefardi.com\/wp-json\/wp\/v2\/categories?post=83186"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/yosefardi.com\/wp-json\/wp\/v2\/tags?post=83186"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}\n