Northstar to buy out Bakrie's debts

PT Bakrie & Brothers announced Friday night that it had reached an agreement with Northstar Pacific to form a joint venture company that would take over Bakrie’s collateralized assets currently in the custody of Oddickson Finance.

Under the deal, Northstar -- a local unit of U.S. based Texas Pacific Group (TPG) -- would buy out a debt that Bakrie owed to Oddickson, which currently stood at US$575 million, Bakrie president director Nalinkant A. Rathod told reporters.

No information was disclosed on the share ownership of the two firms in the joint venture company.

"We have completed a strategic partnership with Northstar. The most important thing about the partnership is the buyout of the Odickson Finance's debt," Nalinkant said.

Bakrie's debt to Odickson formerly stood up to $1.08 billion, which is a combined value of stakes in the world’s biggest power-plant coal producer Bumi Resources, oil and gas producer Energi Mega Persada and property developer Bakrieland.

However, Nalinkant said that the value of the debt had gone down to $575 million partly due to "currency gains" and repurchasing agreement (repo) settlement.

He further explained that after the buyout plan Bakrie would have a remaining debt of about $200 million to other firms that would be resolved by the end of the year. (and)