Indonesia to Take Over 60% of Whoosh Bullet Train Operator by Mid-September
The finance minister will appoint an agency to control PT KCIC and repay loans on the $7.3 billion China-funded Jakarta-Bandung railway without using the state budget.
JAKARTA, Aug 6 (Reuters) - Indonesia's government will take over a controlling stake in the company operating a $7.3 billion China-funded high-speed railway, its finance minister and a senior official with sovereign wealth fund Danantara said.
Here are the details:
• Finance Minister Purbaya Yudhi Sadewa said at a joint press conference with Danantara on Wednesday that he will appoint an agency under his ministry to take over a 60% stake in PT KCIC, the company that operates the bullet train. The value of the stake was not disclosed.
• Commercially named "Whoosh", the 142-kilometre (88-mile) railway connects Jakarta to Bandung, a city southeast of the Indonesian capital.
• The appointed agency will be responsible for repaying the project's outstanding loan, but will not use the state budget, Purbaya said.
• The transaction will be completed at the latest by mid-September, said Dony Oskaria, chief operating officer of Danantara.
• In April, Dony said Indonesia had completed debt negotiations with China for the project, but did not provide details.
• The project has been mired in problems, including land procurement issues, pandemic-related delays and ballooning costs.
• The 60% stake in KCIC is currently held by a consortium of Indonesian state companies, led by state railway firm PT Kereta Api Indonesia, with construction firm PT Wijaya Karya holding a significant share.
• Chinese state firms will continue to hold a 40% stake in the project.
• Danantara controls all Indonesian state firms.
(Reporting by Bernadette Christina; Writing by Gayatri Suroyo; Editing by David Stanway)
