Fashion
Huawei has arranged to acquire a 16.83% stake in Indonesian operator Bakrie Telecom by converting some of the operator’s debt into shares.
Debt-laden Bakrie Telecom issued a 7.6 trillion rupiah ($568.1 million) mandatory convertible bond in 2016 as part of a debt restructuring. Huawei has now decided to convert its holdings of the bond into shares.
With the move, 1.23 trillion rupiah worth of Bakrie Telecom’s debt has been converted into shares.
Bakrie Telecom president commissioner Anindya Novyan Bakrie told that the conversion will help improve the company’s financial situation for this reason, and therefore the company welcomes Huawei’s move.
But under Indonesian trading rules, the shares to be converted will not be available for trading for one year.
While Huawei’s Indonesian subsidiary PT Huawei Tech Investment will also have the right to elect representatives on Bakrie Telecom’s board, Anindya said no decision on this has yet been made.
The possibility of a debt conversion was first floated last year but at the time it was suggested that Huawei would be taking just a 9% stake, with fellow creditors Protelindo and SUPR receiving shares of 7% and 6.8% respectively.
