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Shareholders tell Adam Air to clean up act
Two shareholders of Adam Air have said they will stand by the troubled airline, provided the conditions are right
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Two shareholders of Adam Air have said they will stand by the troubled airline, provided the conditions are right.
Global Transport Service (GTS) and Bright Star Perkasa (BSP), which together hold 50 percent of PT Adam Skyconnection Airlines (Adam Air), said they will not bail out on their investment and may inject more capital if certain conditions are met.
"We are still its rightful shareholders, but we have decided not to provide financial support unless Adam Air's management explains and takes responsibilities for a number of issues," GTS director and Adam Air finance director Gustiono Kistanto said after the airline's shareholder meeting in Jakarta on Thursday.
He said the two shareholders were open to the suggestion by Suherman and Sandra Ang, who hold the other 50 percent of shares, to restore the airline's operations.
However, he said, they would require the airline's management to explain past irregularities and improve performance, particularly in safety.
Adam Air was forced to stop operations after its operating certificate was revoked on March 19. Adam Air served 21 destinations per day using a total of 22 airplanes.
As the sole GTS representative in Adam Air, Gustiono does not have direct access to oversee spending on the operational level, he said.
GTS is a subsidiary of a listed investment company, PT Bhakti Investama, which holds shares in various industries including telecommunications with PT Mobile-8 Telecom, television with PT MNC Sky Vision and financial services with PT Bhakti Capital Indonesia.
"Between August 2007 and February 2008, our cargo services transported at least 2,200 tons per month, which should be worth at least Rp 10 billion. But each month, the company earned only Rp 3 billion.
"We have also discovered management used Rp 2.1 billion for personal expenses between January last year and January this year," Gustiono said.
He said the airline's inventory report claimed the company had spent Rp 120 billion on spare parts for airplanes but was unable to justify the expenditure.
All complaints by GTS and BSP have been reported to the police and are currently under investigation.
All the shareholders agreed to pay the company's 3,000 employees their March salary, despite the suspension of operations, Adam Air president director Adam Suherman told The Jakarta Post after the meeting.
"I'm also glad the shareholders' meeting has shown that GTS and BSP are still our shareholders and are not abandoning their responsibilities to the workers," Adam said.
An Adam Air Boeing 737-400, which took off from Djuanda airport in Surabaya on Jan. 1, 2007, disappeared for a few hours while cruising at 35,000 feet. Its wreckage was found along the coast of Pare-Pare in Sulawesi.
A report issued by the National Transportation Safety Committee earlier this month blamed the accident on problems with navigational equipment, which had had 154 recurring defects before that accident.
Several other accidents have marred the airline's flight record. One month after the Sulawesi crash, an Adam Air Boeing 737 jetliner carrying 148 passengers buckled its fuselage during take-off at Djuanda airport. (lva)
