(7/30/2005)
If recent statements by Indonesia's Minister for State-Owned Enterprises, Sugiharto, are correct, the financial salvation of Indonesia struggling government-owned Merpati Nusantara Airlines may be at hand.
As reported in the Indonesian-language Bisnis Indonesia, Sugiharto has announced that three private investors are competing against each other to provide the Rp. 75 billion cash injection (approximately US$ 7.65 million) needed to keep the Airline operating for the coming three months. As reported on balidiscovery.com [ Parliament Throws Merpati a Lifeline
], the ailing domestic carrier and former subsidiary of Garuda Indonesia is hemorrhaging cash and in desperate need of funds and a restructuring to re-emerge as a low-cost airline able to compete in the current marketplace.
While Minister Sugiharto remains tight-lipped on the identity of the investors eyeing a stake in Merpati, he publicly asked all three to avoid taking any steps that might disturb current restructuring efforts underway at the Carrier.
As part of that restructuring, the Government and Merpati are working to reschedule the Airline's Rp. 1.6 trillion debt (approximately US$163.2 million), now in serious arrears, as well as modernize its antiquated armada of aircraft.
The Minister has given Merpati until the end of the current month to secure the required cash injection from private sources.
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