PT Garuda Indonesia Tbk officially issues Mandatory Convertible Bond (MCB) worth a total of IDR 8.5 trillion, in which the withdrawal of the bailout from the government in the first stage is IDR1 trillion.

According to the President Director of Garuda Indonesia, Irfan Setiaputra, in a virtual press conference on Monday, explained that the MCB issuance agreement was signed today with PT Sarana Multi Infrastruktur, which is the investment implementer of the Ministry of Finance.

“The implementation of MCB fund disbursement will certainly be carried out according to the mutual agreement of all stakeholders, where currently the company will issue MCB funds amounting to Rp1 trillion with a three-year tenor,” he said.

Irfan explained that the funds were the first withdrawal or disbursement and continued withdrawals would follow the principle of prudence and adhere to the principle of propriety and prioritize common interests and uphold compliance and good corporate governance.

He explained that the first withdrawal of Rp1 trillion with a three-year tenor was made based on an agreement between Garuda Indonesia, PT SMI, the Ministry of Finance and the Ministry of State-Owned Enterprises. The company’s performance, which is considered to be improving, is said to have given a positive signal so that bailout withdrawals should be carried out in several stages.

Signals of improving company performance are marked by the growth in passenger movement, which in November reached 739 thousand passengers, a significant increase compared to the beginning of the pandemic period which was only around 30 thousand passengers per month.

“Therefore we agree together that this should be carried out in several stages and this is influenced by the ability of Garuda’s performance and management’s promise when we submitted this bailout,” he noted.

In accordance with the agreement at the Annual General Meeting of Shareholders, the total value of MCB issuance was IDR8.5 trillion with an availability period of up to 2027 or seven years.

Irfan added that the proceeds from the issuance of the MCB are government support to be able to accelerate Garuda Indonesia’s business in the future. He also said that the issuance of the MCB is a mandate that the company must account for.

Therefore, his party also coordinates with the Financial and Development Supervisory Agency (BPKP), the Supreme Audit Agency (BPK), to the Junior Attorney General for Civil and State Administration (Jamdatun) to ensure the use of funds from MCB is in accordance with the portion and needs.

“This all fulfills what has been decided by the Extraordinary General Meeting of Shareholders (EGMS) some time ago and we will follow properly, disclosure of information in accordance with the existing regulations in the Financial Services Authority (OJK),” he stated.

Irfan also hopes that the issuance of MCB at the end of the year will be able to build optimism for the company’s performance in 2021.

“With the issuance of this MCB, we are optimistic that the company’s performance will be better and more dynamic in responding to the challenges of the aviation industry in the future, in line with strategic efforts carried out so far to improve the company’s fundamental performance,” he concluded. [antaranews/photo special]