Borneo Lumbung to lay off workers
Friday, October 17 2014 - 01:02 AM WIB
IDX-listed coking coal producer PT Borneo Lumbung Energi & Metal Tbk plans to lay off workers as part of cost saving measures to help survive the current downturn in the global coal market.
Borneo Lumbung President Director Alexander Ramlie said on Thursday that the company was looking to gradually slash the number of workers from about 3,400 currently to around 1,200.
?We?re implementing layoff program for surplus workers,? Alexander said.
He added that the company has discussed the planned monthly lay off program with its workers and local authorities in Murung Raya Regency, Central Kalimantan Province, where it operates.
He said that the company would recruit the workers again once the industry recovers from the current difficult situation, which has seen the price of coking coal plunging since 2012 due to slower demand in China for the steel ingredient.
Meanwhile, Borneo Lumbung Finance Director Kenneth R. Allan said the company was considering to sell assets including heavy equipment to help raise funds to repay US$800 million worth of debts that would mature in 2019. The company has recently reached an agreement with lender Standard Chartered Bank to restructure a US$1 billion debt facility including stretching the maturity from 2017 to 2019.
Alexander said that as part of the debt restructure deal, Stanchart would be entitled to a 4 percent stake in the coal miner through upcoming rights issue.
Editing by Reiner Simanjuntak