UCI reaches agreement with creditors

Debt-ridden coal mining firm PT United Coal Indonesia (UCI) has finally managed to persuade most of its creditors to agree on a proposed postponement of debt payment, sparing the company from being declared bankrupt, Bisnis Indonesia reported on Monday.

The paper quoted Andrey Sitanggang, an official at UCI, as saying that about 80 percent of the creditors, representing total claims of about Rp 56.16 billion, have agreed to the debt restructuring proposal.

The paper said that the new debt settlement agreement with the creditors is expected to be approved by the court on January 14.

Meanwhile, lawyer Bagus Wicaksono, who represents CV Exiss Jaya and CV Satria Duta, said the two creditors have rejected the proposed debt settlement.

The paper said that specifically to repay debt to Bank Mandiri, UCI plans to raise funds by divesting its subsidiary PT Karya Putra Borneo by June 2015 at the latest.

UCI, set up in 2006, is engaged in coal mining business in East Kalimantan and Central Kalimantan. One of its four mines is the 2,000-hectare Palaran mine in Sanga-Sanga, East Kalimantan, with estimated JORC reserves of 11 million tons. (*)