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Garuda ups pressure on creditors week before deadline
As the court- supervised debt-restructuring period draws to its end, the national flag carrier has expressed hope to reach an agreement with creditors.
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Workers clean a Garuda Indonesia Boeing 737-800 NG at Garuda Maintenance Facility (GMF) AeroAsia at Soekarno-Hatta International Airport near Jakarta on Jan. 21. (Reuters/Willy Kurniawan)
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s the court-supervised debt-restructuring period draws to its scheduled end, Garuda Indonesia has upped the pressure in its negotiations with creditors and expressed hope to reach a deal before the deadline.
Garuda said on Thursday that it offered Rp 11.65 trillion (US$800 million) worth of new debt and $330 million worth of equity to resolve liabilities with lessors, vendors and other creditors with payables above Rp 255 million.
The proposal included plans for the conversion of debt to equity and the modification of long-term payment terms, which the airline would like to adjust through the negotiations.
Garuda’s restructuring team has admitted an $8.3 billion claim that the court has added to the daftar piutang tetap/DPT (fixed payables list).
“We have compiled this proposal in the hope of providing the best and optimal solution for settling the liabilities, especially by taking into account the business plan, market conditions and various input from creditors that Garuda continues to receive to this day,” Garuda CEO Irfan Setiaputra said in a statement on Thursday.
Read also: Garuda Indonesia requests third extension of debt restructuring period
Garuda is currently in the third extension of its supervised debt restructuring process, after the Central Jakarta District Court granted the airline a suspension of debt payment obligations (PKPU) on Dec. 9 last year. The airline has about a week left before the deadline on June 20.
