APP arms face legal threat for late payments

News by

24 May 2001

Trouble continues to mount for Asia Pulp & Paper (APP); the group faces the threat of fresh legal action, while two subsidiaries are to make late interest payments after threats from creditors

Trouble continues to mount for Asia Pulp & Paper (APP); the group faces the threat of fresh legal action, while two subsidiaries are to make late interest payments after threats from creditors (PrintWeek, 4 May).

PT Indah Kiat Pulp & Paper and PT Lontar Papyrus Pulp & Paper each agreed to make late interest payments on 61.5m ($88.5m) of bond issues after creditors threatened legal action, such as bankruptcy proceedings, if they failed to pay.

Last month Indah Kiat missed a 2.7m payment on its bond issue, due to the financial problems besetting its parent.

Singapores High Court has also found in favour of AHC Enterprises Pte over some 449,000 (S$1.17m) owed, with fellow APP supplier Magnesium Elektron filing a lawsuit for just over 1m for contract related facilities, overdraft and guarantees outstanding.

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"This is a repeat of what happened to 1066 Capital t/a Crystal a year ago. They also never put this company in administration. We are all still left unable to claim the redundancy and notice pay owed..."