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Garuda still faces repayment risks, possible lawsuits: Experts
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Garuda Indonesia CEO Irfan Setiaputra and board of director members wait for the results of a vote on the airline's debt restructuring proposals in the Central Jakarta District Court, on June 17. (Garuda Indonesia/Public Relation team)
W
hile Garuda Indonesia is relieved that Boeing, along with several other creditors, did not make any debt repayment claim in the local court within the 30 days following its debt suspension case (PKPU) conclusion, experts believe this alone will not prevent creditors from filing lawsuits to force repayments later on.
Garuda Indonesia finance director Prasetio explained the 30 days were the last call for creditors who wanted to make a repayment claim but could not participate in the airline’s PKPU, which the Indonesian court concluded on June 27.
Prasetio said missing the 30-day period would disable creditors from making further repayment claims, even by filing it in an Indonesian court.
“By law, it’s like they are letting go of the repayments. So, we no longer have obligations to those firms that did not register their claim within the 30-day period,” he told reporters on Aug. 12.
Read also: Creditors approve Garuda's restructuring plan
The Indonesian court ratified Garuda’s debt restructuring proposal on June 27 after the airline won creditors’ approval by a landslide a week prior.
With the proposal, Garuda successfully cut nearly 81 percent of its Rp 142 trillion (US$9 billion) debt by converting it to a new $825 million debt and $330 million new equity.
