Wednesday, June 07, 2006

Where is Marimutu Sinivasan

He once had a dream to make his company Texmaco as big as Toyota Motor Corporation. So he built an integrated textile empire right from the purified therepthalic acid (PTA) plant to feed polyester staple fiber (PSF) and polyester fiber yarn (PFY) plants down to yarns and garments. He also built an engineering company to produce machineries. In just three years (1994-1997) Texmaco companies raised financing of US$685 million from international market. With the support of former president Soeharto, state-owned bank BNI disbursed trillions of rupiah loans to the group. And then all his dreams collapsed with the downfall of Soeharto and the financial crisis. He is now in the police wanted list.

Media reported today that police have launched a massive search for Marimutu Sinivasan, the owner of Texmaco, who is wanted to stand trial in a bank lending scam of Rp50 billion (US$5.4 million). Nobody knows where Sinivasan lives, but his lawyer said Sinivasan fled the country for medical treatment well before the police put him in the wanted listed.

Sadly, AGO had actually named Sinivasan a suspect last August for allegedly causing billions of rupiah in losses to Muamalat Bank in the loan scam. And only last week the deputy attorney general for special crimes Hendarman Supandji requested the police to arrest the high-profile businessman. Why it took so long?

Born in Medan, North Sumatra in 1937, Sinivasan raised to the national and international business community in early 1990s with aggresive investments. He was involved in many acquisitions around the globe to strengthen the textile and engineering business.

He tried to survive after the downfall of Soeharto. Soeharto's successor BJ Habibie visited Texmaco's plants and pledged support for Sinivasan's technology dream. Abdurrahman Wahid even asked attorney general to stay away from Sinivasan arguing the businessman contributes significantly to the country's export earnings.

Internal rift at PDI-P, the winner of 1999 election, almost put Sinivasan behind the bar with the report of Laksamana Sukardi (former state-owned enterprise minister under Wahid's administration) about a bank lending scam with outstanding of billions of US dollars.
Kwik KIan Gie as the coordinating minister of the economy under Wahid administration labelled Sinivasan as black conglomerate.

But Sinivasan survived, some says because of his close relationship with Taufik Kiemas (senior PDI-P politician, and the husband of former president Megawati Sukarnoputri). Sinivasan dismissed the reports that Kiemas was once a commissioner at Texmaco group though.

Wahid then ousted both Kwik and Laksamana. Economist Rizal Ramli who replaced Kwik then insisted to save Texmaco amid rumors that Ramli was previously a business consultant for Texmaco, a report that was classified as rumor as well.
Others said Sinivasan survived on his late brother Marimutu Manimaren's pivotal role at Golkar Party and the chairman Akbar Tandjung. Manimaren was the main lobbyist for Texmaco. His tragic death (reports said a suicide) has influenced the group's lobbying capability.

The downfall of Wahid was followed by the reentering of Laksamana into the cabinet under Megawati administration. Laksamana, once asked Indonesia Bank Restructuring Agency (IBRA) to sell Texmaco's assets to new investors. But Sinivasan managed to keep his control over Texmaco until now.

In early 2003, General Endriartono, that time as the army commander, even asked government to save Texmaco for a possible military industry. Minister Jacob Nuwawea (PDI-P politician) also asked his fellow ministers to save Texmaco for the sake of thousands of workers.
IBRA managed to restructure Texmaco and tried several times to divest the portfolios but always ended in failure mainly because investors valued Texmaco's assets almost zero.

In October 2004, just before the new cabinet of Yudhoyono sworn in, Sinivasan told the press that he would file lawsuits against Laksamana and Syafruddin Temenggung (former chairman of IBRA) for misusing their powers to crush Texmaco and on defamation.
Last year, VP Jusuf Kalla rejected the idea to sell Texmaco's assets currently hold by PT PPA (the successor of IBRA). In June 2005, Trust magazine quoted sources saying Bukaka Group (owned by Kalla family) has been the new owner of Texmaco. But no confirmation on the report.
Few months ago, Kalla turned down Texmaco workers demand saying Sinivasan should be responsible in the settlement.

Texmaco has two main subsidiaries listed at Jakarta Stock Exchange, PT Polysindo and PT Texmaco Jaya with combined assets of Rp6.6 trillion (US$700 million) but both have negative equities due to huge debts. Both companies also booked operating losses in the last few years. Auditors of both companies gave disclaimer to the 2005 financial reports on uncertainties of their future.
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