Lopez Holdings in final stage of debt restructuring process

MANILA, Philippines - Lopez Holdings Corp., the investmet flagship of the Lopez family, is looking forward to a successsful closure of its debt restructuring exercise within the year, a move expected to put the conglomerate in a position to consider new investments.

In a briefing following the company’s annual stockholders meeting, Lopez Holdings president and chief operating officer Salvador G. Tirona said they are in the final stage of the financial restructuring process vigorously pursued for the last nine years. The company’s remaining debt as of end-2010 is $65 million, of which $24 million has been restructured.

“Hopefully, we can do it in the next few months,” Tirona said, pointing out that the company can improve its offer which has been in place since 2008.

Creditors holding unrestructured debt papers may opt to either sell them back to the company, subject to a discount and funds availability, or sign a new loan agreement.

Pursuant to the term sheet dated November 2008, Lopez Holdings will provide a bullet payment for the principal amount in 12.5 years at an interest rate of four percent per annum for its dollar obligations and an interest rate of seven percent per annum for its peso obligations.

“Beyond restructuring, there will be opportunities for new investments. As of the moment, all expansion and new projects or investments are being pursued at the level of the operating companies,” Tirona said.         

Lopez Holdings reported a net income of P13.2 billion last year, up 10.9 percent from P11.9 billion in 2009 on robust growth across its businesses.

The company expects to sustain its strong performance this year with the continued growth of its media and communication and power generation businesses as well as the strengthening of its balance sheet.

The company has significantly reduced debt through the sale of some assets.

Lopez Holdings (formerly known as Benpres Holdings Corp). had undergone a quasi-organization aimed at paring down its capital deficit by P6.7 billion. The company started accumulating the deficit in 2002 at P867 million and shot up to as much as P9.634 billion in 2004.

Unit ABS-CBN Corp., the country’s largest multimedia content provider, is set to expand to the digital platform as it competes head on with perennial rival GMA Network. It is looking to spend between P3 billion and P5 billion on a nationwide rollout of digital TV,which is designed to deliver improved image and sound quality and more programming options to viewers, thereby boosting its ratings.