Medco ready to sell shares if it fails to repay debts

Medco Group is ready to sell its 80 million shares at PT Medco Energy International, if the business group, which is owned by Arifin Panigoro, fails to repay its debts to state owned PT Bahana Pembinaan Indonesia in six months, Bisnis Indonesia reported on Saturday.

Helmi Panigoro, a Medco director, said in Jakarta on Thursday that the shares were part of the assets pledged as collateral to guarantee the business group?s debts amounting to US$65 million in foreign currencies and Rp 110 billion in local unit to Bahana.

Other assets which have been pledged to guarantee the debts included the business group?s shares in Dragon Wall, an il company listed on the London Stock Exchange, 35 percent stake in Medco Energi and its ownership in an office building in Jalan Sudirman, Jakarta.

Helmi said that of the all assets, the business group?s shares in Medco Energi would be much more liquid so that they would be easily sold, if within six months, the business group failed to meet its obligation.

Medco Energi is 67.88 percent owned by New Links, 17.97 percent by PT Medco Duta and 14.20 percent by the investing public.

He said that Medco signed loan agreements with Bahana several years ago, purely based on a business principle. Helmi also denied the charge that the company obtained the debts due to the special relations between his brother Arifin to the government?s top officials in the past.

Arifin, one of President Abdurrahman Walhi?s main political foes, is one of several political figures who have been put into the Attorney General?s investigation lists, for their alleged corruption practices during the Soeharto era.(*)