MANILA, Philippines – Owners of the beleaguered Philippine Women’s University (PWU) are strongly opposing the move of STI Holdings, Incorporated to seek the foreclosure of the university’s Manila campuses, arguing it has no basis.
STI has asked the Manila Regional Trial Court to allow the takeover of two campuses of PWU in Taft Avenue and Indiana Street in Manila.
Foreclosure proceedings for the Quezon City and Davao properties of PWU would follow, STI said.
The Benitez family, owners of PWU, filed a case before the Manila RTC in January challenging STI’s declaration of default, PWU media director Lydia Benitez-Brown said in a statement Wednesday, February 11.
“STI’s latest move is a legal matter and will be dealt with in the proper legal forum,” Brown said.
The Benitezes will honor its commitment to Eusebio Tanco and STI but stressed that it would only be under “fair and just terms,” Brown said.
The STI’s demand for the family to pay P923 million ($20.83 million) for obligations of P448 million ($10.11 million) is “exorbitant and unacceptable,” Brown said.
STI bailed out PWU in 2011. It bought the debt paper from BDO Unibank and provided additional funds to pay for salaries and wages, utilities, repair leaks, retirement pay, upgrade of laboratory facilities and learning, and other operational expenses.
STI also provided the professional and technical support to establish the financial, accounting, and human resources system PWU needed.
The corporate battle continues
On February 10, STI asked a Manila court to start the foreclosure of PWU’s Manila campuses for failing to pay STI almost P1 billion ($22.56 million) in accumulated loans, interest, and expenses.
“The filing will protect the interest of STI and its shareholders, STI president Monico Jacob said.
Jacob added that they were supposed to be have been paid in shares of stocks in 2011 but to date, no payment has been made.
The Benitez group was supposed to pay STI with shares of stock through an increase in the authorized capital of PWU’s sister firm, Unlad Resources, 5 days from the bailout.
When the PWU board was to take up the capital increase in December, the Benitez camp asked for an adjournment, thus delaying anew the payment to STI.
“The first required step of increasing the authorized capital stock of Unlad Resources, PWU’s sister company that would absorb the school’s assets, was never taken by the Benitez group,” Jacob said.
The Benitez family had already sent a formal settlement offer to Tanco and STI on the first week of this month, Brown disclosed.
The family proposed to pay STI Holdings to cover principal and a “break-up premium.”
This was confirmed by STI.
Jacob said the first offer was signed by the PWU president but offered no amount and interest rate.
The second offer came from Unlad offering P550 million ($12.41 million) to be paid in installment.
But these offers “were empty” and meant only for public consumption since the Benitezes have been saying they are willing to pay, Jacob said.
“We spent hard cash worth almost P500 million ($11.28 million) to rescue PWU. How can they offer, assuming the Unlad offer is legitimate, P550 million ($12.41 million) which means no interest, VAT (Value Added Tax), and legal expenses will be covered?” Jacob asked.
In December, STI declared the Benitezes in default of its loan to them, which the family denied, thus they filed legal action against STI. – Rappler.com
US$1 = P44.32
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