Kuok plans sale of P300-M RP properties

Publicly-listed Kuok Philippine Properties Inc. (KPPI) will divest around P300-million worth of properties to wipe out debts and allow it to pursue the development of other projects.

At the sidelines of the company’s stockholders’ meeting yesterday, KPPI president Tomas C. Zita Jr. said the company is in talks with various groups for the possible sale of its interest in KPPI Land Corp., which owns a 946-hectare property in the towns of Carmona and Silang in Cavite.

The company also plans to divest its property in Cebu and half of the 107-hectare property in Tagaytay which it owns jointly with Crown Equities Inc.

Zita said the company plans to swap its entire stake in KPPI Land in exchange for the buyer assuming the balance of a $61.4-million (roughly P3.4 billion) long-term loan with Rhinestrone Corp., an affiliate firm.

The foreign loan, which falls due in March 2007, carries an interest rate of seven percent per annum which translates to an annual interest burden of $4.375 million or P240 million per year.

"Our objective is to clean our balance sheet by wiping out all our debts. We hope to be debt-free by the end of the year or early next year," Zita said.

Zita said the settlement of its foreign debt would place the company in a better position to concentrate on developing its 400-hectare property in Mabini, Batangas and its 20-hectare land in Naic, Cavite.

He said the prospective buyers are currently verifying the authenticity of the property titles.

KPPI derives its financial strength from its strategic alliance with the Kuok Group of Singapore, a leading property developer in the Western Pacific Rim. The Kuok Group holds a significant equity interest in KPPI.

The most visible of the Kuok Group’s enterprises have been its successes in hotel ownership and management of the distinguished Shangri-la International hotel chains.

KPPI was incorporated to primarily engage in the business of property holding and investments. It is also authorized under its present charter to engage in the industries of food, trading, agriculture, aquaculture, construction, infrastructure development including energy-related projects, transportation and manufacturing.