Not Wanting The Same Fate As Indosat When Megawati Was President, Garuda Workers Union Asks DPR Chair Puan Maharani To Reject The Proposal To Release Majority Shares

Garuda Indonesia aircraft. (Photo: Wikimedia Commons)

JAKARTA - Daily Chairman of the Garuda Indonesia Employee Union Tomy Tampatty asked Commission VI of the House of Representatives to reject the SOE Ministry's proposal to release the government's majority stake in PT Garuda Indonesia (Persero) Tbk.

"We hope that the Speaker of the House of Representatives, Mrs. Puan Maharani and all members of the House of Representatives, will reject the request for approval from the Ministry of SOEs to Commission VI of the House of Representatives to release the majority of shares of Garuda Indonesia owned by the government to private or foreign parties," he said when contacted by VOI, Friday, November 12.

For your information, the proposed release of the majority share was issued by the Deputy Minister of BUMN II Kartika Wirjoatmodjo in a meeting with Commission VI of the DPR a few days ago. Meanwhile, the option to dispose of these shares will arise if the company is still short of funds to recover its debt restructuring during the completion of Garuda Indonesia's debt restructuring. The Ministry of SOEs wants new shareholders to deposit funds to the company.

Furthermore, Tomy explained his reasons for rejecting the option to dispose of the shares. He admitted that he did not want Garuda Indonesia to have the same fate as Indosat, whose majority shares were released to the private sector.

"Because if the DPR approves that the majority of shares of Garuda owned by the government are sold to private or foreign parties, then Garuda Indonesia's flag carrier status will become the 2nd Indosat when Megawati is president. This will be the worst record for the Indonesian people," he explained.

Previously, Deputy Minister of BUMN II Kartika Wirjoatmodjo disclosed the current financial condition of the national airline Garuda Indonesia. He asked for his blessing regarding the possible dilution of the dilution option, or a decrease in the percentage of share ownership of the GIAA-coded issuer.

"We ask for the support of your opinion, ladies and gentlemen, if there are new shareholders, are we allowed to do dilution instead of government ownership," he said in a meeting with Commission VI, at the DPR Building, Parliament Complex, Tuesday, November 9.

The dilution option is if the company still needs funding to continue its business in the future after the restructuring. Funding will come from third parties.

Furthermore, Tiko, as he is familiarly called, also gave a signal that the government may no longer be the majority shareholder in Garuda Indonesia.

"It may even be that the government is no longer in the majority, so we ask for support from ladies and gentlemen," he said.

According to Tiko, Garuda's rescue is also more than half of its power to rely on creditors. This is because the amount of debt obligations that are the airline's burden to creditors.

Meanwhile, to carry out the restructuring, Garuda needs at least US$527 million in funding from the government, equivalent to Rp7.5 trillion.

Furthermore, Tiko said the funding could consist of interim funding worth US$90 million in the form of a senior secured loan, as well as additional funding of US$437 million as a form of funding needs after the restructuring process is complete.

"In addition, if the available funding for Garuda is still not sufficient, then Garuda will carry out a fundraising process from third parties that will allow dilution of government ownership," he said.