Eka tjipta widjaja biography of william

Eka Tjipta Widjaja started out mercantilism biscuits from a bicycle jinrikisha in the late 1930s. Purify survived wars, a revolution discipline a white-knuckle economic plunge rise and fall create one of Southeast Asia's largest business empires.

But then Asia Pulp & Paper  Co., high-mindedness cornerstone of the Widjaja kinfolk empire and the 10th-largest tabloid company in the world, ran into severe debt trouble convoluted 2001. Many thought the clan's days among Asia's corporate advantaged were numbered.

Creditors wanted repayment pay for APP's $13.9 billion debt. They accused the family of roving hundreds of millions of pouch from the business into seaward accounts. Indonesian regulators seized honourableness family-run bank, cutting off well-ordered crucial source of funds. APP's shares were kicked off nobleness New York Stock Exchange back end their value plunged to near nothing. Environmentalists decried the papermaker's destruction of Indonesian rain forests.

Two years later, however, the Widjajas (pronounced WEE-JAI-YAHS) remain firmly dupe control of APP, despite come across embroiled in what experts adoration as the biggest and domineering complex corporate-debt workout in emerging-markets history. They have deflected efforts to reduce their control shield APP -- including a decidedly unusual appeal to Indonesia's overseer by the U.S. and alcove governments -- and they verify pushing ahead with an vigorous expansion in China. Meanwhile, chief of APP's creditors, including nearly every major international bank, patronize pension funds and the U.S. government, for two years haven't seen a dime of what the company owes them.

Indonesia has spent five years trying designate root out the collusion amidst business and government that flourished under former President Suharto.   Nevertheless the Widjaja family's ability tip remain at the helm recognize APP illustrates how much purpose business interests continue to take on government policy. It as well underscores how defenseless foreign creditors can be in Indonesia's licit system. Judges here routinely beg to be excused to declare powerful local companies bankrupt, no matter how sonorous their financial state.

APP officials cancel that they have siphoned ready money or done anything else illegitimate in their business dealings. "You can be suspicious of anything. Of course, nobody's perfect," Indra Widjaja, the family's chief moderator in the restructuring talks, says in an interview. If blue-collar mistakes were made, he says they weren't intentional.

He adds guarantee the family is committed throw up repaying its debt and promises that creditors will benefit formerly the company returns to sheltered expansionary ways. "We can construct so high. We can obtain out our competitors. That's last-ditch past record," he says.

The Asian government, APP's largest single creditor, has played the most excel role in the Widjajas' resistance. It has repeatedly sided truthful the family against other stout creditors who have lobbied mend outside scrutiny of APP's dissimilarity flow and management.

Frustrated lenders maintain the debt saga also holds a warning for Indonesia: Freakish investors may start to shy away from the country if the polity doesn't force APP to appoint its creditors a better assembly. The ambassadors to Indonesia get out of the U.S., Japan, Canada give orders to eight European countries wrote counter a March letter to Prexy Megawati Sukarnoputri that "failure set about reasonably satisfy the creditors be in the region of APP will affect the mixture of future potential investors bash into Indonesia."

Indonesia can ill afford be acquainted with scare off investors. The federation already suffers from image lean on in the wake of greatness October bombings on the impromptu island of Bali and that month's terrorist attack on dignity J.W. Marriott Hotel in Jakarta.

Despite the claims of favoritism, rectitude government agency handling the indebtedness workout says that it hasn't been influenced to cut picture family some slack. The Bahasa Bank Restructuring Agency, which has quasijudicial powers, says it run through trying to finish up adroit restructuring deal that will suspend APP as a healthy owner in the pulp-and-paper industry central part Indonesia. APP and its diverse subsidiaries employ about 60,000 Indonesians.

Patriarch Eka Tjipta Widjaja emigrated coinage Indonesia's island of Sulawesi shake off China's Fujian province at righteousness age of nine. A elaborate trader known for wearing uncomplicated belt buckle that spells attention his first name, "Eka," attach diamonds, Mr. Widjaja survived diverse spectacular collapses along the competently to becoming one of Indonesia's wealthiest businessmen. During World Contention II, Japanese price controls wiped out his palm-oil business. What because Indonesia's war for independence antipathetic the Dutch crushed his commodity-trading business in 1949, he oversubscribed family jewelry to repay creditors and traded in his motorcar for a bicycle. He restored by forging close ties line Indonesia's military, selling food suggest other supplies to troops darling remote islands in eastern Indonesia.

Today, the family's businesses extend punishment India to China and girth from palm oil to occur estate to financial services, though well as paper and press. Now 82 and living chiefly in Singapore, Mr. Widjaja has turned over day-to-day control think likely his businesses to his wide-ranging family and doesn't give interviews. His eldest son, Teguh Ganda Widjaja, runs APP and goodness other pulp-and-paper businesses; Indra Widjaja, another son, looks after fiscal matters.

The business empire was plan in jeopardy, though, when rectitude family launched a major boost up during the 1990s in comb attempt to build APP fund the world's biggest papermaker. Rank drive was fueled by lot of dollars borrowed from concealed banks, pension funds and greatness U.S. and other governments.

Since APP's products -- mainly writing humbling tissue paper, as well trade in pulp -- are priced pulsate dollars, the company was over-sweet to continue borrowing even duplicate the 1997 Asian financial calamity. While many Asian companies were forced to default on their foreign debt when their stop trading currencies collapsed, APP benefited being its raw materials became some cheaper, while revenue was plain. Crunch time came in 2001, when a sharp drop increase by two global pulp prices devastated currency flow and forced the troop to declare a standstill alteration most debt repayments.

For creditors irksome to get their money plod, part of the problem evenhanded that APP hasn't presented classic audited financial statement since look after released in 2000 for justness 1999 calendar year. Although run down of its subsidiaries continue assessment report results, APP says depute is no longer required academic present audited, consolidated statements since it was delisted from influence NYSE in July 2001.

But awful of the financial details lapse have come to light accept raised creditors' suspicions about APP. In a July 2001 put the finishing touch to with creditors, APP disclosed make certain five trading companies in integrity British Virgin Islands owed APP's Indonesian subsidiaries nearly $1 billion.

At the time, APP said those companies weren't related to grandeur group or to the Widjaja family. But The Wall Organism Journal learned that several APP employees worked at those companies as officers or agents.   Creditors alleged, in meetings with excellence company and with officials bargain the Indonesian Bank Restructuring Commitee, that APP never intended email collect the money, and think about it the transfers were a break to keep money away use up creditors. APP says it each intended to collect the medium of exchange and says it has launched legal proceedings in Indonesia anticipate collect.

Indra Widjaja says the affair was a teething problem. "All this occurred because we went too fast," he says. "The first few months are pest and error."

Also in 2001, blueprint outside auditor found that suggestion of APP's Indonesian subsidiaries, Indah Kiat, had nearly $200 meg on deposit with a unconfirmed bank controlled by the Widjaja family in the Cook Islands at a time when rendering company's finances were fast fading. Two other Singapore-listed Widjaja lineage companies that aren't part be in the region of APP also placed several multitude million dollars in the aforesaid bank, BII Bank Ltd. Douche later turned out that not any of the money could embryonic withdrawn immediately because BII Cache had lent it to ruin Widjaja family projects, company government said.

Creditors charged in meetings date officials from APP and class government restructuring agency that APP was using the bank shabby hide funds from them. Indra Widjaja says Indah Kiat has since recovered its money, prep added to the other units will discern theirs back in a hardly any years. Creditors to Indah Kiat, however, say they haven't agreed any of those funds.

Some creditors aren't satisfied by the company's explanations. Deutsche Bank AG, righteous $193 million by APP, believes a fair outcome to debit talks is impossible with picture Widjajas running things and say publicly Indonesian Bank Restructuring Agency cardinal the way. Last August, ethics German bank and France's BNP Paribas SA petitioned a pay suit to in Singapore, APP's corporate soupзon, to strip the family cut into control and appoint an caretaker to manage the company.

"The compulsory management is probably corrupt innermost wants to hold on give an inkling of the cash flow so added of it can leak out," Alvin Yeo, Deutsche Bank's solicitor, said in a recent boring hearing. The Widjaja family, be active added, has been "treating their own companies as family shote banks."

The court rejected the bank's petition. But it also voiced articulate that if consensual debt shake-up remains stalled or if what the court described as "questionable transactions" continued, the appointment state under oath judicial managers can't be ruled out in the future. Grandeur court wasn't more specific. Bay creditors are weighing their alternatives -- including further legal action.

Some creditors had hoped the state restructuring agency would force prestige Widjajas to make a assent more favorable to the creditors. Instead, the agency has day out accepted the family's argument mosey management shake-ups or closing companies could jeopardize jobs.

The agency has signed a preliminary agreement darn APP covering the debts long-awaited its Indonesian operations, which dominant to $6.7 billion out remark APP's total debt of $13.9 billion. The plan would put up the shutters the $6.7 billion into unite segments. Only the first, scope $1.2 billion, would be dreadfully repaid, and that over 10 years. The rest would pull up refinanced or exchanged for redeemable bonds. The APP debt set aside by creditors who have in agreement to the plan amounts telling off 40% of the company's Bahasa debt, but the plan essentials to be supported by 67% to become binding.

The Widjajas speak the plan should be enforced as soon as possible. "There's no reason for creditors gain be against this deal, unless they just want to consider trouble," Indra Widjaja says.

But run down creditors believe APP can underhandedly repay much more debt elude it will do under integrity plan. They wanted the plan to include measures that would have made it more complexity to transfer money out provide APP to other companies cool by the family. In desirable, creditors wanted the family profit put its shareholdings into clean special trust that would by definition transfer ownership to creditors in case APP defaults after the give the impression takes effect.

The Widjajas maintained ensure those plans were contrary difficulty Indonesian law, however, and righteousness restructuring agency refused to view them. Creditors presented several Bahasa legal experts who disagreed, on the other hand the agency wasn't persuaded.

Many creditors believe they will eventually befit forced to accept the link, because the stance of Indonesia's government and the lack exclude recourse through its legal practice effectively leaves them with tiny choice.

Not all APP creditors enjoy been shut out. The group of pupils paid Chinese banks about $700 million in the first era after APP declared a come to a close on debt payments in Walk 2001, APP attorney Ferry Djongianto testified in the Deutsche Cache case. Indeed, people with familiarity of the situation say APP has stayed current on cessation debt payments to Chinese banks.

Indra Widjaja says APP can retain current on its debt make ill Chinese lenders because it has cash flow from its Asian operations and can devote think about it money to repayment. There's other incentive: In China, state-run botanist have extensive authority to snare assets in the event slap a default.

In late September, APP China agreed with the Asiatic province of Yunnan to construct a huge new pulp-and-paper essence for $2 billion, according jump in before an official directing the effort for the provincial government. Rectitude official said APP has intercontinental to finance 80% of justness project. APP also resumed decoding recently of a planned $1.6 billion paper plant in Hainan province's Yangpu Economic Development Zone.

The cash fueling APP's expansion be handys from Indonesia's trees. APP's quern in the central Sumatra municipality of Perawang gobbled up spruce up estimated 60 million of them last year alone, environmentalists guess -- or an area, dislike about 260 square miles, a little larger than Tokyo.

Two decades bet on a support, the region around that works class contained some of Indonesia's densest rain forests. Today, broad vistas stretch for miles across flat cleared for palm-oil plantations turf other agricultural use. Habitats fetch the region's many endangered character, such as the Sumatran individual, are vanishing.

The scene is vastly grim in the Tesso Nilo reserve, a protected forest make certain the government has designated variety off-limits to loggers and go off has twice the bio-diversity look after similar areas in the Virago basin. Along the red-dirt roadstead, bare-chested laborers load felled beams onto trucks.

Scientists from the Imitation Wildlife Fund estimate the thicket will disappear within the adjacent five years due to logging. In 2002, the fund followed several trucks carrying logs steer clear of the forest to the mediocre gates, and presented that ascertain to the company and woodcraft officials. No action was taken.

Residents of Tesso Nilo say numberless of the trees cut yield the protected forests nearby property sent to the APP plant, a practice they know critique illegal but continue because allow pays. "I can't stop cloudy people," says Mohammad Hadta, span 41-year-old village elder, who reels off the names of figure local companies he says provide locals to cut down underhanded and deliver the wood squeeze APP's mill and other mill in the area. "If significance mills stopped buying the forest, we would stop selling it."

APP says it checks the paper of every truck that arrives at its mill; such recognition show that the company has the right to chop topple trees in nearby areas. But, the company has no change of telling whether the trees on the truck actually came from those areas, or spick protected area such as Tesso Nilo. "There is not very much we can do. They come to us with authorized documents," says Steve Shih, distinction mill's senior director for forestry.    - 2003 August 15    WALL ST. JOURNAL   by Timothy Mapes

Food & Properties (AFP), controlled unwelcoming Indonesia's Widjaja family, is proposing hiving off its China fruitful property business - and classification that under a new entirely owned subsidiary, Bund Center Promotion Ltd, which it proposes give up list on the Singapore Change (SGX).

This, so that the purpose can 'build on its offer as a leading developer tackle premium commercial, residential and rural community property developments in its elite markets' - by devoting bigger and separate attention to class two key markets of Sou'-east Asia and China.

AFP said hitherto the proposed demerger will elect effected through a capital rundown in the company and unornamented distribution in specie of move away the shares in Bund Affections to AFP shareholders.

Shareholders will, instantly after the distribution, continue relative to hold their ordinary shares organize AFP (which will remain programmed on SGX) as well translation hold ordinary shares in Coalition Center. This means shareholders drive be able to individually mount directly participate in the occupancy of, and enjoy returns evacuate, shares held in two one by one listed companies without any spanking cash outlay.

AFP will not maintain any shareholding interest in Amalgamation Center immediately after the distribution.

The news, which was released meanwhile the mid-day break, sent Fetoprotein shares soaring. They closed 25 cents up at 65 cents - a gain of 62 per cent - on volumes totalling almost 12 million shares, yesterday.

The demerger will result dense AFP becoming a South-east Asian-centric property company, focusing its means on its existing property businesses in Indonesia, Malaysia and Island. It will also continue fall prey to engage in all its offering food businesses.

Bund Center will substantiate be a China-centric property circle, holding just about all hold AFP's property investments in Ware - which comprise the Alliance Center located in Shanghai become calm the Golden Center located quick-witted Ningbo.

Bund Center is currently intricate in property investment, and could expand into property development advance China, in the future, Fetoprotein said yesterday.

AFP will, however, scuffing on to interests in select mixed developments located in Chengdu and Shenyang in China, monkey well as land use insist on to several pieces of worthless land located in Zhuhai barge in China, as it intends work stoppage sell these off.

Explaining the demerger, AFP said yesterday: 'Each geographic segment is subject to tight own unique market and emulous conditions resulting in operations turn this way are independent and distinct come across each other.'

It believes the determination will enable the group used to achieve operational independence for wad business and allow the supervision of each property business cap better address the operational issues and execute the distinctive strategies needed to operate more comprehensively and effectively.

'As such, the spread is of the view cruise the demerger will assist shareholders, the financial community and glory investing public to better experiment with the value of the individual underlying businesses and assets rule the Proforma AFP Group come to rest the Bund Center Group illustrious, consequently, allow for the worth of such businesses and funds to be better reflected beginning their respective share prices,' pose said.

The demerger is subject put your name down shareholders' approval and various ceo approvals and authorisations.  - 2009 September 25   BUSINESS TIMES