Company sources said Belle plans to form Highlands Prime Leisure Properties Inc., with assets of roughly 600 hectares in Cavite and Batangas, including property development in Tagaytay Highlands International Golf Club and Tagaytay Midlands Golf Club Inc.
Belle will retain control of the clubhouse and golf course of Tagaytay Highlands as well as the club shares with a combined market value of about P3 billion.
"We will sell substantial portions of the new company so we can raise additional capital to pay off Belle’s debts," sources pointed out.
Out of total debts of P6.3 billion, Belle has $86.5 million in foreign debts, mostly dollar-denominated floating rate notes.
Sy has indicated interest in acquiring at least 20 percent of Highlands Prime because this would strategically tie in with future developments in his sprawling 600-hectare Hacienda Looc seaside property in Batangas.
Through publicly-traded SM Prime Holdings, Sy is already one of the major stockholders in Belle, with a substantial 25 percent stake. Aside from Sy, six other groups – one foreign and five local – have expressed interest in the new company.
Sources said Highland Prime will publicly raise 10 percent of its capital by the third quarter of this year. The initial public offering (IPO) will be a primary share issuance where existing Belle shareholders will be given first crack at subscribing to the new shares.
The proposed IPO will, however, have to face the hurdles on new listings, particularly for start-up companies with no track record, set by the Philippine Stock Exchange.
Sources said the PSE may reconsider and "bend some of its rules" for Highland Prime because "this IPO could provide a boost to the flagging local stock market."