A debt-to-equity swap plan at its Chinese holding group would lead to the separation of its Chinese operating firms from its Indonesian units and Singapore holding firm.

APP deputy chief executive Michael Black was unable to comment, but was confident in the Indonesian side of the business going forward.

The pulp and paper giant has also said that its on track to meet its environmental targets, despite labelling them as aggressive.

Black said APPs agreement to work with WWF Indonesia on environmental conservation and forest management, announced in August, had been received positively by customers and environmental groups (PrintWeek, 28 August).

There was still a wait and see attitude, he added, but the group planned to meet WWFs deadlines.

Black said 2003 had been a building phase for the firm, with the assembling of a new senior management team to take it forward.

Appointments included Terry Hanley as chief operating officer, while Eero Palokangas, the former

Stora Enso Asia Pacific senior vice president, has also joined.

Black said APP would produce its 12-year Sustainable Wood Supply Plan by the end of January 2004, a move awaited by many environmental groups.

APP hopes to reach an agreement with creditors on its debt-restructuring plan by the end of this month.

As part of the agreement, Black said APP had started a minimum mandatory debt service, with monies being put into escrow.

Story by Andy Scott