Danaharta approves NSC deal

The sale of the National Steel Corp. (NSC) to Global Infrastructure Holdings Ltd. (GIHLI) has been approved by the Pengurusan Danaharta Nasional Berhad (Danaharta), the asset management arm of the Malaysian government.

Negotiations are still on-going between the NSC, GIHLI and NSC’s creditor banks but the transaction was initially accepted by the Malaysian company that took over NSC’s former major stockholders, Hottick Holdings Inc.

NSC creditors however, are still asking for improvements in GIHLI’s offer, particularly for a shorter repayment period 10 to at least seven to eight years from the original offer of 10 years.

According to the Land Bank of the Philippines (Landbank), one of NSC’s major creditors, GIHLI was being asked to come up with a better offer that would shorten the repayment period once the company takes over the facilities of the steel plant.

The transaction, however, inched closer to being concluded as it got Danaharta’s approval. The state-controlled Malaysian firm took over Hottick’s controlling shares in NSC when Hottick went belly-up earlier.

Landbank president Margarito Teves told reporters that GIHLI has already met with NSC creditors where the company was asked to make improvements on its offer, primarily the restructuring of the repayment period for NSC’s debts.

Despite its deteriorating condition, NSC still attracted two serious offers from GIHLI and LML Metal Group. But GIHLI was the more serious of the two and its offer has been brought to the creditors for evaluation.

GIHLI’s offer, according to Teves, was to lease the NSC facility with an option to buy. "But the creditors want GIHLI to firm up their price and shorten the repayment period," Teves said.

Teves said GIHLI was given 60 to 90 days to come up with a better package which would be evaluated by the creditors again.