Singapore turns launchpad for Widjaja clan seeking acquisitions

SINGAPORE (BLOOMBERG) - Indonesian billionaire Eka Tjipta Widjaja is getting support from Singapore financiers to fund expansion as he bids for a London-listed mining company.

A reverse takeover last month created the family's fifth Singapore-listed company, coal miner Golden Energy & Resources Ltd., while palm-oil producer Golden Agri-Resources Ltd. tapped the city's bond market twice in the past five weeks.

Mr Widjaja's also seeking control of Asia Resource Minerals Plc, a route to becoming one of the top four coal producers in his home country.

Investors have funded the five Singapore entities with S$4.3 billion of loans and bonds to help Mr Widjaja build an empire with a market value of US$7.5 billion (S$ 10.12 bilion) on the city's stock exchange, data compiled by Bloomberg show. His latest ambitions and the backing he's winning from investors show how far the 91 year-old has rebounded from the US$13.9 billion Asia Pulp & Paper Ltd. default in 2001.

"It was interesting to see how they scraped through without having to dismantle their business," said Robert Appleby, co-founder of Asia Debt Management Hong Kong Ltd., which was a creditor in the APP debt restructuring. "The people with the longest staying power ended up on top. So today, as the manifestation of that, you have the Widjajas once more, a generation has moved on and their offspring largely driving their second coming."

The ARMS bid is being undertaken by the family's Sinarmas group via its Asia Coal Energy Ventures Ltd. vehicle, which was vying with U.K. banking scion Nathaniel Rothschild until the financier abandoned his plan last week.

Sinarmas is targeting ARMS to gain control of its 85 per cent of PT Berau Coal Energy, Indonesia's fifth-largest coal miner. A successful deal would be a boon for the family's Golden Energy unit, headed by the tycoon's 33-year-old grandson, who has said the companies could combine to become one of Indonesia's four biggest producers.

Berau would come with some big challenges. The miner's bondholders have watched their investments halve in value over the last year amid boardroom spats and tumbling coal prices. It must repay a US$450 million bond due July 8 and ARMS said in March that there wasn't enough cash for noteholders.

"Sinarmas is the best chance for Berau to recover and pay off the almost US$1 billion in debt," Fuganto Widjaja, who oversees the family's energy and infrastructure business and heads Golden Energy, said in a May 13 e-mail.

Berau also has until March 2017 to repay US$500 million of 7.25 per cent notes. The distressed notes have started to rebound this month, climbing from 51.6 cents in the dollar at the end of April to 57.7 cents on Friday at 9:38 a.m. in Singapore. Its 12.5 per cent bonds due 2015 have climbed 6.1 cents to 60.9.