Closed In 2022, Garuda Indonesia Completes The Restructuring Process

Illustration of Garuda Indonesia aircraft/ Photo: Bitor Ekin Putra

JAKARTA - Coinciding with the closing moment of the year, PT Garuda Indonesia (Persero) Tbk officially completed the process of restructuring business performance, which was marked by the issuance of New Securities and New Sukuk on December 28 and 29, 2022.

This was done as a final series of strategic corporate actions carried out by Garuda to reach an effective date based on a peace agreement that was homologated by the Commercial Court at the Central Jakarta District Court on June 27, 2022.

"We express our appreciation and gratitude to all stakeholders who continue to support Garuda's efforts to complete this restructuring stage, especially all creditors who always believe in the outlook for Garuda's business performance in the future," said Garuda Indonesia President Director Irfan Setiaputra, Saturday, December 31.

He detailed that a number of strategic stages have been passed by Garuda in completing the restructuring process, starting from the acquisition of homologation decisions on Peace Agreements by the Central Jakarta District Court, including maximizing renegotiating aircraft rental expenses, restructuring long-term debts, and other business obligations instruments.

In addition, Garuda has also officially received State Capital Participation (PMN) funds worth IDR 7.5 trillion as support for the restructuring of Garuda's performance as a national flag carrier.

A number of fundamental stages of the compensation for the restructuring process were carried out through the issuance of new shares by granting Pre-emptive Rights (HMETD) of 39,788,136,675 shares or Rp7,798,474,788,300 covering the realization of PMN and the participation of other shareholders.

This stage is then followed by the addition of Capital Without Pre-emptive Rights (PMTHMETD) where Garuda has distributed shares in the context of debt conversion of 25,806,070,908 shares or Rp5.05 trillion, which includes the realization of Mandatory Convertible Bonds.

With a series of new share distributions, Garuda currently has a composition of share ownership consisting of 64.54 percent of Government ownership, 7.99 percent of Trans Airways, 4.83 percent of public shares, and 22.63 percent of creditors' shares.

Complementing the completion of the new share issuance stage, Garuda has also issued Sukuk Baru as part of the follow-up to Garuda's restructuring of Global Sukuk worth 500 million US dollars which has been restructured into new sukuk with a principal value of 78.01 million US dollars with a maturing tenor of 9 years since its is issued.

The amount of periodic distribution is 6.5 percent cash or during the first two years of Trustee's choice, 7.25 percent that must be paid in the form of natural (payable in-kind/PIK).

Furthermore, Garuda has also issued a New Securities instrument, as part of a restructuring scheme for creditors classified as leasers, financing rental creditors, aircraft manufacturers, MRO vendors and foreign business debt creditors who are entitled to receive new debt securities according to the Peace Plan with an initial principal amount of 624.2 million dollars with a fixed tenor for 9 years since it was issued.

In line with these strategic steps, Garuda also recorded positive performance growth, through passenger growth in groups until the 3-2022 quarter of 37.05 percent to 10,498,823 passengers compared to the same period last year.

"The passenger traffic is also expected to continue to grow by 30 percent before the end of this year when compared to the November 2022 period," concluded Irfan.