Buyers eye two All AsiaCapital subsidiaries

More buyers have expressed interest in acquiring the insurance and pre-need subsidiaries of the debt-saddled All AsiaCapital group, an official of the Securities and Exchange Commission (SEC) said yesterday.

He said All AsiaLife Assurance Corp. and All AsiaPlans Corp. are being considered by the Yuchengco group and Legacy Scholarship Plans, respectively.

The Yuchengcos’ Great Pacific Life Assurance Corp. (Grepalife), one of the country’s largest with over one million policyholders, is reportedly training its sights on life insurance arm All AsiaLife while sister company Pacific Plans Inc. had earlier indicated an interest in All AsiaPlans.

Aside from the Yuchengco group and Legacy Plans, All AsiaPlans, whose operations have been temporarily suspended by the SEC due to non-compliance in its trust fund requirement, was also being considered for a buyout by AXA Insurance of the Metrobank group, the Chan group and global insurance giant New York Life.

The SEC official added another interested pre-need company, Permanent Plans, had backed out of the talks with All AsiaPlans due to the latter’s debt problems.

All AsiaPlans is a unit under the highly-diversified local investment house All Asia-Capital and Trust Corp., one of the biggest players in the domestic capital market.

But its parent company All AsiaCapital got into financial difficulties on the servicing of a $17-million loan from International Finance Corp. (IFC), the private sector venture fund of the World Bank. IFC itself has a seven-percent stake in All AsiaCapital.

Eventually, the financial woes of all AsiaCapital spilled over top its subsidiaries such as All AsiaLife Assurance and All AsiaPlans which similarly encountered cash flow problems. All AsiaPlans’ permit to sell, for instance, was suspended for failing to meet their trust fund requirement and was only allowed to collect payments and service existing planholders.

The SEC said the company was required to comply with its commitment to contribute at least P1 million per month to the trust fund to meet the deficiency as well as current contributions.

Last year, All AsiaPlans reported a loss of P125.679 million although its revenues from plan collections went up 56 percent to P122.195 million as the heavy toll of servicing its P112.6-million liabilities weighed down on its operations.

All AsiaCapital, in fact, has requested the SEC for the suspension of its operations amid its debt problems and a worsening internal conflict even as it is in the middle of mapping out a rehabilitation program.

Last September, the financial conglomerate sought debt relief as it filed for a debt payment moratorium along with a rehabilitation proposal before the Regional Trial Court of Makati.

All AsiaCapital has been at loggerheads with IFC since the latter expressedly manifested disgust over the way the company is being managed and had called for a complete overhaul of ownership and management.

All AsiaCapital’s problems started last year when it was besieged by the heavy pre-termination of placements and investments of its clients, following the collapse of several other investment companies notably Westmont Investments Corp., East Asia Capital Investments Corp., and Corporate Investments Philippines Inc. (CIPI).

Although All Asia boasts of an asset base of over P6 billion, most of these are reportedly lodged in real estate and long-term commercial papers which could not be readily converted into cash to supplement its estimated P1 billion in short-term liquidity needs.

Aside from IFC, All AsiaCapital also has UK-based Lombard Asian Private Investment Co. as a foreign partner with a 12.8-percent stake. The Filipino investors in the company, on the other hand, include the Chemphil group, Alsons, Asian Terminals, AFP-RSBS and state financing institution Land Bank of the Philippines.