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Govt tells SOE banks to help bankrupt textile firm

The Supreme Court has rejected an appeal by publicly-listed textile company PT Sri Rejeki Isman (Sritex), upholding the Semarang Commercial Court’s decision to declare the company bankrupt on Oct. 23.

Aditya Hadi (The Jakarta Post)
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Jakarta
Fri, December 20, 2024

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Govt tells SOE banks to help bankrupt textile firm Still going: Sritex employees are hard at work at the company's factory in Sukoharjo, Surakarta, Central Java, in this undated photo. (JP/Nani Afrida)

T

he government has maintained that publicly listed textile company PT Sri Rejeki Isman (Sritex) should remain operational despite the Supreme Court’s rejection on Wednesday of an appeal from the firm to avoid bankruptcy.

The Supreme Court decision automatically upheld the Semarang Commercial Court’s verdict to declare the company bankrupt on Oct. 23.

On Thursday, the government urged state-owned banks, which are among Sritex’s creditors, to collaborate in keeping the company afloat so that it would not need to lay off its workers.

“I have spoken with Sritex’s management to reassure the firm amid its concern [to continue its operation despite financial issues]. All creditors, including [state-owned lender] BNI, which is one of the largest, [must] lead other creditors in aligning with the government to preserve jobs,” Coordinating Economic Minister Airlangga Hartarto said on Thursday, as quoted by Bisnis.

Read also: Textile firm Sritex declared bankrupt

According to the company’s financial report as of the third quarter of this year, Sritex booked US$1.6 billion in liabilities, which far exceeded its $594 million worth of assets. The firm still has $836.8 million in outstanding long-term bank loans, with $23.8 million owed to BNI.

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However, the curator of Sritex’s bankruptcy found the company and its subsidiaries owed a total of Rp 32.63 trillion (US$2 billion) to creditors as of December, according to a report from Bisnis.

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