Senior representatives from Indonesian conglomerate Asia Pulp & Paper (APP) are hopeful a debt-restructuring deal will be signed this weekend.
Officials from APP and the Indonesian Bank Restructuring Agency (Ibra) are holding talks in Bali on a framework repayment terms for APP's four main Indonesian operating subsidiaries - Pindo Deli Pulp and Paper Mills, Tkiwi Kimia, Indah Kiat Pulp & Paper and Lontar Papyrus Pulp & Paper Industry.
But it remained unclear yesterday how widely any breakthrough would be supported by other creditors of the Singapore-based group, which owes US$13.9 billion and is the largest debtor in emerging markets.
The negotiations, which started on Thursday and will continue today, are understood to follow talks between APP executives and some of its US-based creditors earlier this week in New York.
APP defaulted in March last year after a massive debt-financed expansion programme went off the rails and pulp prices collapsed. Sorting out the mess has become a priority for the Indonesian government, which through Ibra is owed about US$1 billion by APP and its parent, Sinar Mas Group.
Gandhi Sulistyanto, an APP executive, said yesterday: 'We are optimistic a restructuring plan can be signed [by Monday].' It is understood at least two leading members of the controlling Widjaja family are at the Bali talks.