An official of CAP said International Global Capital Holdings AG (IGCH), a fund manager based in Europe, will be able to raise at least $25 million as equity capital based on the maturity value of the MRT bonds at $160 million.
CAP has concluded a consulting agreement with IGCH which will provide financial advisory services to the local pre-need company.
The CAP official said IGCH will tap HSBC Zurich as the disbursing bank for the proposed transaction.
The same official said CAP is now awaiting documentation of this equity infusion and expects the transaction to be completed within 30 days.
The CAP official said the funds to be raised from the sale of the MRT bonds will be sufficient to cover all obligations for the coming school year.
As this developed, the Securities and Exchange Commission has prevented CAP from disbursing funds from its trust fund which now stands at P4.7 billion.
SEC chairperson Fe Barin underscored the need for CAP to further strengthen its trust fund to ensure it meets all obligations to planholders.
Barin said the SEC shall call CAP officials to a meeting this month to discuss developments in the company’s ongoing fund-raising activities.
The SEC chief said the collegial body will discuss this week the terminal report prepared by the CAP oversight committee. Sources said one of the recommendations of the committee is to appoint a management committee that will oversee CAP’s operations.
The management committee shall draw up measures aimed at saving CAP from bankruptcy and at the same time protecting the interest of investors.
CAP first vice-president Bobby Café assured the public that the pre-need firm is committed to fulfilling its obligations to thousands of its planholders.
Café said CAP is now completing all the requirements needed for the approval of its application for increase in capital stock now pending with the SEC. CAP is raising its capital to P8 billion.
The capital increase would reflect the infusion of a P6-billion property owned by businessman Romeo Roxas in CAP. CAP is transferring a 3,000 hectare property in Quezon, which will be developed into an educational center.
In exchange for the property infusion, Roxas will get one board seat in CAP.
The SEC, however, did not set any deadline as to CAP’s compliance with the requirements since it has no more securities to the public.
SEC officials said they want to make sure that the needed funds are infused into CAP prior to renewing the latter’s dealership license.