KIK-EBA Garuda Indonesia Rp2 Trillion Restructured Not In Debt And Receivable Category, Payment Tenor Extension To 10 Years

JAKARTA - PT Garuda Indonesia (Persero) Tbk received approval for restructuring the fulfillment of the Company's obligations to the collective investment contract for asset-backed securities (KIK-EBA) Mandiri GIAA 01.

KIK-EBA Mandiri GIAA 01 is an investment instrument for Garuda Indonesia which was launched in 2018, where the company securitized revenue rights from the sale of Garuda flight tickets on the Jeddah and Medina routes to KIK-EBA holders worth IDR 2 trillion with a tenor of 5 years.

The restructuring approval was obtained through an agreement to extend the payment tenor of KIK-EBA to 10 years. As well as scheduling a new payment with a balloon payment mechanism referring to the investment contract and applicable supporting provisions.

The approval for the restructuring was decided through the General Meeting of Mandiri Asset Backed Securities Holders GIAA 01 which was held on Monday, yesterday.

The approval and support of KIK-EBA holders for the restructuring proposal is represented through voting results with the approval of votes of 92 percent of the total KIK-EBA holders who are present and have met the threshold requirements.

The President Director of Garuda Indonesia, Irfan Setiaputra, said that the approval of the restructuring of the fulfillment of business obligations by the KIK-EBA holder has an important meaning for the continuous support of Garuda's strategic partners.

"Especially for KIK-EBA holders regarding the company's performance outlook in the midst of a performance restructuring phase that we are currently carrying out intensively and thoroughly in all business lines," he said in an official statement, Tuesday, June 14.

In the midst of the Debt Payment Obligation Suspension (PKPU) that is being carried out by Garuda, said Irfan, this stage of restructuring KIK-EBA is one of the focuses of accelerating performance recovery which is carried out carefully and prudently in accordance with applicable regulations.

Irfan said this was done by taking into account that KIK-EBA has different specifications from the components of business obligations where this investment instrument is not classified as a debt category but as a collective sale and purchase contract referring to the provisions of the Financial Services Authority (OJK) number 65/POJK.04 /2017 concerning guidelines for issuance and reporting of asset-backed securities in the form of collective investment contracts.

Thus, continued Irfan, the stages of completion of the Company's obligations under this investment contract need to be carried out through the applicable investment contract management guidelines.

"This approval for the restructuring of KIK-EBA is a positive outlook in the midst of a comprehensive restructuring process that is being intensified by the Company through the PKPU process. We thank you very much for the support from KIK-EBA holders for the sustainable steps that we continue to optimize for the sustainability and future of Garuda Indonesia's business in Indonesia. This is a very challenging phase," he said.