The business empire controlled by Aburizal Bakrie, Indonesia's chief welfare minister, said on Sunday it was looking to sell stakes in listed companies to settle $1.2bn in debts that were guaranteed by shares that have lost at least 74 per cent of their value in recent months.

Bakrie & Brothers, the family's holding company, said it would also encourage the companies it controls to buy back as many shares as possible.

The announcements confirm widespread speculation that the diversified group is in financial trouble after becoming overleveraged. These reports were a major contributor to the Jakarta stock market crashing over three days before being suspended last Wednesday.

Market players welcomed the news but cautioned it would be insufficient to calm the market when it re-opens on Monday, as uncertainty remained over how Bakrie & Brothers could raise enough money through share sales and still retain control.

James Bryson of HB Capital Partners said: "Resolution of the debt issue, rather than promise of it, is the key to restoring confidence."

The exchange authorities said no decision had been taken on whether to lift the suspension on trading in Bakrie & Brothers and its five related companies that was imposed last Tuesday.

The other companies are Bumi Resources, one of the world's largest thermal coal companies, Bakrie Telecom, Energi Mega Persada, Bakrie Sumatera Plantations and Bakrieland Development.

Bakrie & Brothers has asked that trading in all the companies remain suspended until the stake sales - which would still result in the holding company retaining control of the other companies - have been completed.

Crédit Lyonnaise, Avenue Asia Capital of the US and India's Tata Group are the foreign entities that have expressed an interest, while Bakrie is also in talks with Sampoerna and the Djarum Group.

Bakrie & Brothers executives said they might sell 10 per cent of Bumi, of which they own 35 per cent. Bumi said separately it intended to buy back an additional 20 per cent of its shares on top of the 13 per cent it had already announced.

Bakrie & Brothers said its debts were guaranteed by shares worth $6bn at the time of the deals, earlier this year. The company's total market cap was $1.42bn when last traded, on Monday, while the value of the shares it held in Bumi and the four other companies was $2.2bn.