Ginting added that the company is still to calculate the number of shares that will be swapped in these deals. However, the number will most likely exceed the amount of shares that were offered to five other creditors last week. Last week, Bakrie & Brothers issued IDR 990.7 billion (approx. USD $74 million) worth of mandatory convertible bonds to restructure its debt obligations to Daley Capital (IDR 430.4 billion), Interventures Capital Ltd (IDR 373.8 billion), Smart Treasure Ltd (IDR 90.8 billion), Harus Capital Ltd (USD $6 million), and Maybank Kim Eng Securities (IDR 14.7 billion). This involves a total of 19.8 billion shares (17.45 percent of Bakrie & Brothers paid up capital) at IDR 50 a piece. Creditors can convert the bonds into shares in the next five years (every 15 June or 15 December of the year).

This corporate action lowers Bakrie & Brothers' debt position and liabilities. In March 2016, the company's negative net working capital reached IDR 9.0 trillion (approx. USD $667 million) as liabilities exceed its assets. A negative working capital - for an extended period - typically indicates that a company struggles to make ends meet and has to rely on borrowing or stock issuances to finance the working capital. Ginting said the company's negative working capital is expected to ease to IDR 2.8 trillion after the mandatory convertible bond was issued last week. In case the three creditors - Mitsubishi Corporation, Glencore International, and Eurofa Capital Investment - will accept the new mandatory convertible bonds, then working capital may turn positive.

Stock Quote Bakrie & Brothers - BNBR:

Bakrie & Brothers Financial Highlights:

      2009     2010     2011     2012     2013     2014     2015
Net Revenues    7,632   19,288   16,695   15,479    5,213    6,379    4,662
Gross Profit (loss)
   3,705    (485)    5,087    2,503    1,163    1,404     626
Net Profit (loss)
  (1,735)   (6,998)     132     355  (12,723)     152   (1,719)
EBITDA (loss)
   1,878   (7,276)    3,222    2,038     562     665      32
Total Assets   26,388   31,768   25,213   15,658   11,878   11,314    9,186
Total Liabilities   18,212   18,121   13,046   10,198   13,972   13,500   13,122
Net Profit per
Share¹
  (18,51)   (81,53)     4,82     1,36  (135,78)     1,65   (18,62)

in billion IDR rupiah, except otherwise indicated
¹ in IDR rupiah
Source: Bakrie & Brothers, Annual Report 2015

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