Feud Erupts Over Inheritance of $46 Billion Indonesia Empire
(Bloomberg) -- A feud has erupted over the inheritance of billions of dollars of businesses controlled by Indonesia’s Sinar Mas, with one of the children of the group’s late founder seeking a share of the empire spanning palm oil to banking and property.
Freddy Widjaja, a son of the late tycoon Eka Tjipta Widjaja, asked the Central Jakarta district court to recognize him and five of his siblings as legal heirs to Eka and designate a dozen companies and their assets as their inheritance, the court said on its website. The claim was filed on June 16 and lists Indra Widjaja, Teguh Ganda Widjaja, Muktar Widjaja, Djafar Widjaja and Franky Oesman Widjaja as defendants.
Sinar Mas dismissed Freddy Widjaja’s claims as “baseless” and said as a child born “out of wedlock,” he held no stake in any of the group’s companies. Gandi Sulistiyanto, a managing director at Sinar Mas, said in a statement that Freddy had already obtained his share of wealth in accordance with the will of the patriarch who died in January 2019. The conglomerate has nothing to do with the family squabble, he added.
Freddy Widjaja is seeking a share of the assets of the companies, valued in the lawsuit at about 659 trillion rupiah ($45.8 billion). The firms include PT Sinar Mas Agro Resources and Technology, PT Sinar Mas Multiartha, PT Sinar Mas Land, PT Bank Sinarmas, PT Indah Kiat Pulp & Paper, PT Pabrik Kertas Tjiwi Kimia, PT Lontar Papyrus Pulp & Paper Industry and PT Bank China Construction Bank Indonesia, according to the court filing.
Eka’s fortune was estimated at $9.3 billion when he died at the age of 98. He built a multi-billion dollar empire with businesses ranging from paper and pulp to financial services after becoming a coconut and palm-oil trader at the age of 15.
Read: Indonesia Palm Oil Tycoon Who Built $9 Billion Empire Dies
The Indonesian tycoon of Chinese origin overcame a major setback with the 1998 Asian financial crisis, which led to a $14 billion default by his flagship Asia Pulp & Paper Co. Widjaja managed to restructure the debt and rebuild his empire, which employs around 380,000 people in Indonesia, even though several of Sinar Mas’s businesses were taken over by the government after the fall of the dictatorship of General Suharto.
Shares of some of the Sinar Mas group companies fell in Jakarta on Tuesday. Sinar Mas Multiartha, the holding firm for financial services businesses, fell as much as 7% before closing 0.9% lower at 17,350 rupiah, Indah Kiat Pulp & Paper tumbled 5.5% to 7,300 rupiah at close, while Sinar Mas Agro Resources & Technology closed 0.3% lower at 3,300 rupiah, rebounding from losses of as much as 7% in intraday trading.
©2020 Bloomberg L.P.