A court in Indonesia rejected 's demand forrepayment of a $1 billion loan granted to Indonesian coal firm PT BorneoLumbung Energi & Metal Tbk, which is controlled by mining tycoon Samin Tan,Reuters reported April 3.
Backed by his coal assets, Tan took out the loan in 2011 andused it to acquire a stake in rival coal miner Bumi Plc. As of September 2015,Tan owes Standard Chartered more than $700 million, due by 2019, the newswirenoted.
Standard Chartered had sought to be included in the list ofcreditors after PT Borneo Lumbung's Asmin Koalindo Tuhup mine, or AKT,suspended repayments and sought protection.
But the court, which is administering the debt plan for themine, turned down the bank's request, saying it was not clear whether theStanChart loan was used to develop AKT.
A lawyer for AKT noted that the loan was to PT BorneoLumbung, even if the mine was used as collateral.
Court records obtained by Reuters showed that Standard Chartered'sclaim for more than $628 million from AKT was rejected. The accepted creditorsinclude the parent PT Borneo Lumbung itself, as well as equipment manufacturerCaterpillar, and Australia &New Zealand Banking Group Ltd.
As a result, AKT will have to first repay its approveddebtors and then give cash to its parent, which in turn should pay StandardChartered.