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10:20
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Originally posted by Aesi
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Unfortunately Skeoch could be correct. EWC refuse to tell the price at which the Indonesians have the option to buy the assets in 2022. The price could be $1 or it could be $100m. GE told the 2016 AGM that the concession was a BOOT scheme. (Despite the scheme being reported as a BOO scheme). The "T" stands for transfer, where the scheme is transferred back to the state,usually at a peppercorn price of $1. This theory is supported by the depreciation schedules and the pension assumptions for the Indonesian assets. Pension liability is cut off at 2022. The assets will be fully written off in 2022. The terminal value in 2022 would not be zero if the auditors believed the concession had any value.
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EWC's venture in Indonesia will be a classic case and a prime example to any other foreign company thinking about doing business with Indonesia, it just isn't worth the effort, IMHO.
