Monday, November 02, 2009 | MANILA, PHILIPPINES [ BusinessWorld Online ]
A FAMILY corporation linked to the contractor of the mothballed Expo Pilipino theme park at the Clark free port in Pampanga is seeking court rehabilitation, unable to pay more than P800 million in debt.
Selegna Holdings Corp.’s rehabilitation case, first filed with the Makati Regional Trial Court in 2006, is now with the Supreme Court, documents showed.
A court filing last month showed that Selegna Holdings has lodged a motion for reconsideration with the high court, which had sided with both the appellate and regional trial court in finding the company’s rehabilitation plan defective.
The liabilities of the firm, owned by Edgardo H. Angeles, and his family, amount to P842. 15 million, consisting of bank loans and advances from shareholders.
Selegna Holdings owes money to Metropolitan Bank & Trust Co., Union Bank of the Philippines, the United Coconut Planters Bank, RCBC Savings Bank and the central bank, standing in for the closed Bankwise, Inc.
Under its rehabilitation plan, revenues from the carpark building it operates at the University of Santo Tomas would be funneled to Metrobank to pay for a loan worth around P250 million.
Other creditors were offered dacion en pago, and the option to restructure the loans over 15 years with floating interest rate. But this would depend on availability of free cash flow from the car park.
The trial court, however, shot down the proposal on May 31, 2007, saying this favored Metrobank over other creditors, which is against the state’s policy for bankrupt corporations not to discriminate among debtors.
The Court of Appeals likewise rejected Selegna Holdings petition, describing it as a "mere ploy" and an effort to avoid foreclosure.
The appeals court said the company also failed to prove that stockholders had advanced P351 million, and questioned why it lent P80.98 million to sister firm Asian Construction and Development Corp. (AsiaKonstrukt) amid financial difficulties.
Selegna Holdings claims its real estate projects failed to take off because of the 1997 Asian financial crisis.
AsiaKonstrukt was tapped by the Ramos government to build the controversial Expo Pilipino for the country’s centennial celebrations. In 1998, then president Joseph E. Estrada shut it down amid corruption allegations.
BusinessWorld contacted Selegna Holdings for comment, but officials said only Mr. Angeles, who was out of the country, was allowed to comment. -- Don Gil K. Carreon
