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Govt to inject $1.34B to debt-laden infrastructure SOEs, plans transfer of ownership
The government will inject US$1.34 billion of state capital injection to state-owned construction Hutama Karya (HK) and Wijaya Karya. It also plans to transfer ownership of Waskita Karya to HK.
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Construction work is seen on the Bogor-Ciawi-Sukabumi (Bocimi) toll road project in 2018.
(Antara/Puspa Perwitasari)
T
he government is seeking to provide more than Rp 20 trillion (US$1.34 billion) in state-capital injections (PMN) to save debt-laden state-run construction firms and infrastructure projects, according to the State-Owned Enterprises (SOEs) Ministry on Monday.
PT Wijaya Karya will receive a Rp 8 trillion injection to strengthen its financial condition and resolve its debt problems. The company is at a standstill, with creditors agreeing not to enforce loan repayment while a consensual restructuring is being negotiated.
The ministry has also proposed a Rp 12.5 trillion injection for PT Hutama Karya, which is regarded as being in a relatively healthier financial state.
Hutama Karya is set to take over two toll projects, namely Bogor-Ciawi-Sukabumi (Bocimi) and Kayu Agung-Palembang-Betung (Kapal Betung). Both were initially handled by PT Waskita Karya, which failed to make timely payments on its corporate bonds in early May.
Waskita’s default also resulted in the Indonesia Stock Exchange (IDX) halting trading of its shares for the second time this year, while the Finance Ministry also decided to halt the scheduled Rp 3 trillion injection, until the firm could resolve its financial problems.
Prior to its default, Waskita Karya had received Rp 7.9 trillion in state capital injections in 2021, which the government gave to aid its debt restructuring.
"In the future, there is a possibility for additional injections if there is an increased necessity to restructure Waskita Karya's debt," SOEs Deputy Minister Kartika Wirjoatmodjo told lawmakers on House of Representatives Commission VI on Monday.
