Hottick Investments, Ltd., which owns over 82 percent of the biggest steel firm in the country, belied SEC’s assumption that NSC "is bankrupt and therefore, has to be liquidated."
Arturo de Castro, counsel for the Malaysian firm, said last week that SEC ordered the liquidation of NSC last Oct. 3 in the light of what it perceived as bankruptcy crippling the steel firm for good.
But the SEC, he said, has no authority to liquidate the steel firm not only because the law prohibits it from doing so, but also because "NSC is not bankrupt."
Analysts, however, believe that NSC has, indeed, been if not, on the brink of being bankrupt especially since it has not been operational with the implementation of SEC’s liquidation order underway.
"NSC’s facilities have been sitting idly by, its equipment depreciating by the day, its capacity to earn crippled for good owing to SEC’s order for its liquidation," an NSC official said.
SEC Chairman Lilia Bautista maintains that the liquidation order came on the heels of NSC’s perceived inability to drag in a so-called white knight to save it from insolvency, and eventual liquidation.
"I’ve given them (NSC) almost a year to present to me investors who can bail it out but so far, they have not presented any credible investor yet," said Bautista, adding that NSC officials even had the propensity to hide the identities of prospective "white knights."
The steel firm, enmeshed in an industry directly affected by the high interest rates and a tottering peso, has to forego any SEC-formulated rehabilitation plan which simply did not sit well with Hottick.
The only "rehabilitation," Bautista said, is when investors will eventually buy the cash-strapped NSC. But, from the looks of it, she added, it will take time before any concrete solutions to NSC’s problems will come to the fore.
De Castro, for his part, maintained that SEC acted unjustly in ordering NSC’s liquidation without giving any other rehabilitation plan a chance to be mapped out and adopted before acting on what its interim receivership committed asked it to do.
The agency, he said, just fell short of bullying the steel firm in ordering its liquidation "without a hearing with notice to all the interested parties and without conducting termination proceedings pursuant to Section 21 of the Rules of Corporate Recovery." – Rommel Ynion