The PSE said it decided to list the suspension and allow trading on Philrealty starting Oct. 21 as the company’s court-approved rehabilitation plan is not seen to affect in any way its capital structure since this does not provide for any conversion of the firm’s outstanding obligations into equity.
The approved plan also does not call for a corporate reorganization. Thus, the P1 par value of Philrealty’s shares and the number of shares of stocks subscribed, issued and outstanding remain unchanged.
The Quezon City Regional Trial Court has approved the amended rehabilitation plan for the debt-laden real estate developer as it found the company’s business still viable.
In its order, the court said Philrealty deserves a chance at rehabilitation in accordance with the amended plan which calls for the settlement of its bank loans through a combination of dacion-en-pago (payment-in-kind scheme) and debt restructuring.
In approving the plan, the court noted that all creditor-banks were in agreement that the petitioner is susceptible to rehabilitation as it is solvent.
The court also said there was no serious or significant objection to Philrealty’s proposal to settle its debts through dacion.
"To the court, the amended rehab plan of petitioner deserves due consideration. It is the product of a well-thought out study based on verifiable data and based as well on the results of the meetings with the creditors. The recommended combination of a debt restructuring and dacion en pago as integral composition of petitioner’s amended plan is found to be fair and viable," the Quezon City RTC said.
The plan calls for the settlement of P1.31 billion in secured debt through dacion, the restructuring of P890.6 million in debt over a 10-year period, and the completion of the Skyline Tower of the company’s Andrea North Project in Quezon City, estimated to cost P1.18 billion.
Philrealty’s rehabilitation receiver said he considers the completion of the Andrea Skyline project critical to the firm’s rehabilitation efforts "as this would restore public confidence on the ability of petitioner to continue and complete its on-going projects and undertake new projects in line with its main purpose of real estate development."
The cashflows expected from joint ventures or sale of Philrealty’s remaining assets will be used to complete the Andrea Skyline project.
Philrealty will retain P957.2 million worth of properties which could be used for operations, joint venture development and sale.
The receiver expects Philrealty to raise about P3.89 billion in cash over a period of 15 years assuming that the company can limit total administrative expenses to a yearly increase of five percent per annum, which the increase in rental/lease income should cover.
Philrealty’s total debts to secured creditor banks stand at P2.2 billion, P1.8 billion of which is owed to Metropolitan Bank & Trust Co., Philrealty’s biggest creditor-bank.