Creditors swoop on APP

Two of Asia Pulp and Papers (APPs) creditors have taken the unusual step of seizing control of the firms exhibition booth at a trade show in Florida.

The two bondholder creditors, Oaktree Capital Management and Gramercy Advisors, seized the booth  at the International School, Home and Office Products Association (SHOPA) show.

 

Oaktree's associate general counsel Melissa Obegi said the company had been left with no choice but to enforce its 195m judgement against APP.

 

"The seizure of the APP stand demonstrates our intent to enforce our judgement against any APP assets that we find, wherever we find them."

 

However, APP has claimed the creditors were advised that the trade booth was the property of Tjiwi Kimia, and not the property of APP. However, Tjiwi Kimia is a production facility subsidiary of APP.

 

APP's director of sustainability and stakeholder engagement, Arian Ardie, said the seizure of the booth was an illegal attempt to seize property.

 

"We intend to vigorously pursue our legal remedies against the creditors and their lawyers for the attempted unlawful seizure."

 

Ardie said the actions taken at the SHOPA trade show were nothing more than an attempt to try and intimidate Tjiwi Kimia's customers and trade partners.

 

Oaktree and Gramercy won a 223m ($400m) judgement against APP in April this year.

 

This meant the plaintiffs could seek enforcement of any of APP's assets in any location.

 

However, the bondholders suffered a recent setback, when an Indonesian court invalidated over 307m of APP's bonds.

 

APP and its subsidiaries declared a moratorium on debt repayments in 2001.

 

Since then APP has struggled to gain approval from its creditors for a restructuring scheme, which covers 3.7bn of its estimated 7.7bn debt.

 

Story by Andy Scott