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IT IS DRESS casual day at the Jakarta head offices of PT Medco Energi Internasional one of Indonesia's leading oil and gas businesses. In addition to jeans and baggy cotton shirt, Hilmi Panigoro, the CEO, is sporting a broad grin. Well he might, for the ink has just dried on an agreement that finally returns the company to control of the Panigoro family after almost nine years. Like many Indonesian companies immediately after the financial meltdown in Asia, Medco was caught out badly, with large amounts of dollar-denominated debt and hundreds of petrified foreign creditors.
"Most financial institutions before the crisis were queuing in front of the CEO's door begging us to take their money," says Panigoro. "When 1997 came they simply came and said 'We want our money back'. We had no choice: we had to restructure."
Fortunately for Medco, unlike many other Indonesian companies, as an oil and gas business almost all of its revenues were in US dollars meaning that it did not suffer from the crisis of the devaluation of the rupiah so much as from a timing differential between projects and their financing.