Uniwide creditors endorse amended rehabilitation plan

Creditors of the debt-saddled Uniwide Group of Companies have endorsed the company's proposed amended rehabilitation plan and have asked the Securities and Exchange Commission (SEC) to fastrack the approval of its proposed amended rehabilitation plan.

The interim receivership committee led by its chairman Monico V. Jacob, and members Cornelio T. Peralta and Arthur N. Aguilar, told the SEC the approval is needed soonest as there are many implementing activities which can only be done after the company's recovery plan is sanctioned by the corporate watchdog.

Jacob said Uniwide has received comments from 39 secured and unsecured creditors out of about 1,200 creditors. Among the secured creditors, three banks whose total exposure to the Uniwide Group amounts to P1.531 billion filed their opposition to the amended rehabilitation plan.

These oppositors comprise 22 percent of the total value of the obligations to secured creditors. However, the receiver continues to negotiate with these banks and "it is most likely they will eventually agree to the amended rehab plan with the possible exception of one bank with a credit which comprises 10 percent of the total value held by secured creditors," Jacob said.

Meanwhile, unsecured creditors with a total exposure of P68.815 million have opposed the rehab plan mainly because they object to the 50 percent discount held on their credit.

Jacob said the SEC should approve the plan shortly.

"Considering that the amended rehabilitation plan is not opposed by a majority of any class of creditors... but only by 22 percent of the secured creditors and two percent of the unsecured creditors, the plan should already be approved."

Jacob said the SEC's approval is "absolutely necessary" because of the need to close the transaction with Casino Guichard-Perrachon, the French retail giant which will pay P3.57 billion in cash for 89.2 percent of Uniwide subsidiary, Uniwide Sales and Warehouse Club Inc. (USWC).

Uniwide is badly in need of new money as it continues its losing streak, posting a bigger net loss of P2.665 billion in 1999 compared to P667.2 million the previous year.

Uniwide said its operations and finances further deteriorated last year because of the substantial interest payments to a number of its creditors to which it owes an aggregate of about P13 billion.

To get back on its feet, Uniwide is awaiting the approval of its amended rehabilitation plan by the SEC. At the same time, it has been entering into agreements with its creditors for a dacion en pago or payment in kind settlement of its debts. It has already signed an agreement with the United Coconut Planters Bank and East Asia Capital to extinguish its loans through the dacion en pago scheme.