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FTI sale not likely this year —Sevilla

by Elaine R. Alanguilan
[ Manilastandardtoday.com ] August 16, 2010

The Finance Department may not be able to sell the 103-hectare Taguig property of Food Terminals Inc. within the year due to lack of firm interest from the market.
“We are working on it right now but we’re not confident we could do it within the year,” Finance Undersecretary John Philip Sevilla told reporters.
He said the government would prefer the sale of the property through a public bidding. There is no firm commitment from other parties, except for one group that earlier made an unsolicited proposal to acquire and develop the property.
“Our options are open for the mode of sale. The seller, which is government, would always want public bidding, but the buyer would want a negotiated sale,” said Sevilla.
He has said the government had reached out to big property developers capable of developing the lot to drum up interest in the privatization effort.
The government is hoping a rosier macroeconomic outlook and renewed investor confidence will make the FTI property more attractive.
The government of President Gloria Arroyo earlier attempted to sell the property in October last year for a minimum price of P13 billion but the bidding failed.
“The value [in FTI] is in selling the whole thing. If you are the buyer, you can master plan if you get the entire property,” said Sevilla.
Earlier, he said the government would prefer selling the property at less than P10 billion on an as-is, where-is basis.
Sevilla said the current leases in some portions of the property had also deterred the sale. The government generates about P250 million to P300 million from the annual revenues.
The government has set next year’s revenues from privatization at P6 billion, with the FTI property account for the bulk of the amount.
“We have set a target of P6 billion in privatization revenues for next year but there are no specific assets that are attached to the amount. If we get [to sell] FTI next year in an all-cash transaction, then the P6 billion would be met. But we are open to the possibility that the entire payment would not be made upfront. The P6 billion is a target and it is up to us to find ways to raise that amount since privatization is not like taxes that are there to be collected,” said Sevilla.
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