Liquidators of collapsed Peregrine Fixed Income have signed a settlement agreement with the largest single debtor Steady Safe to try and recoup some of the US$280 million in debts owed by the company.
The agreement will allow Steady Safe to use assets and shares to repay part of its US$280 million loans, increasing the chance for company creditors to get more money back.
Peregrine Investment Holdings, the Hong Kong-based investment bank, went into liquidation in January 1998 after its fixed-income arm suffered huge losses when Indonesian taxi company Steady Safe failed to repay US$280 million in debts.
Steady Safe was the largest debtor to Peregrine Fixed Income so the agreement is an important step forwards in the liquidation.
Under the agreement assets from Steady Safe will be transferred to Peregrine Fixed Income, including buses, taxis, toll roads, taxi licences, ferries and other equity investments in a number of companies and joint ventures.
The debt from the scheme includes a 14 per cent stake in listed Citra Marga Nusaphala Persada, a toll road operator. Peregrine Fixed Income will also receive 32.5 per cent of Steady Safe's equity.
Peregrine liquidator and PricewaterhouseCoopers partner David Hague said Steady Safe would begin delivering assets after certain conditions were met. These included the approval of the committee of inspection of Peregrine Fixed Income, agreement of Steady Safe shareholders and the issue of new Steady Safe shares.