The Bitter Option for Sweet Gendhis

The era when people believed in the saying 'as long as the boss is happy' should have been buried long ago. The decision by the directors and commissioners of plantation firm Perkebunan Nusantara (PTPN) III to refuse the order of State-Owned Enterprises (SOEs) Minister Rini Soemarno to acquire the Gendhis Multi Manis sugar factory was right. It was an uncomfortable moment for Minister Rini, but from a business perspective, the acquisition would have been a gross mistake. Apart from the high cost, the prospects for the sugar factory were far from clear.

The order to acquire it is linked to the target for self-sufficiency in sugar by 2019. This target would be achieved by building new plants or buying existing ones. Gendhis was chosen because it is bankrupt. It has not produced anything for seven months. The offer price was cheap, only Rp300 billion. Owner Lie Kamadjaja claimed he had invested Rp1.7 trillion in Gendhis.

May 17, 2016