Benpres subsidiary hikes capital

The Securities and Exchange Commission has approved the increase in authorized capital stock of First Philippine Infrastructure Development Corp., from P1 billion to P2.5 billion. First Phil. Infrastructure is a 30-percent-subsidiary of Benpres Holdings Corp.

Documents filed with the SEC showed the capital hike was intended to finance additional working capital requirements.

Organized in 1994, FPIDC operates an eight-kilometer tollroad that is envisioned to connect the Subic Bay freeport area to the North Luzon Expressway.

FPIDC has a 76.3-percent stake in Manila North Tollways Corp., which will undertake the rehabilitation, expansion and operation of the North Luzon Expressway. Its other partners in MNTC are Egis Projects SA of France (10 percent), Leighton Australia Ltd. (10 percent) and the Philippine National Construction Corp. (3.7 percent)

MNTC’s tollroad project involves the widening of the existing 84-kilometer North Luzon Expressway, construction of new interchanges, upgrading of existing interchanges, and installation of a new toll collection system. It is estimated to cost $375 million, to be financed with 36 percent equity and 64 percent debt.

In July 2001, MNTC secured a $254-million loan from the Asian Development Bank, International Finance Corp., Export Finance and Insurance Corp., SEK of Sweden, and a consortium of foreign banks.

The project benefits from having experienced tollroad companies as sponsors. PNCC is a government corporation that has the franchise for both the North Luzon Expressway and the South Luzon Expressway.

Egis, on the other hand, developed and operates more than, 6,000 kilometers of toll expressways in Europe. The three sponsor corporations will form an operations and maintenance company for the operation of the tollroad.

Construction work on the project had incurred delays due to the government’s failure to acquire the necessary right-of-way (ROW) for the widening of the road.

To eliminate the need for it to put in additional equity in the tollroad company and to raise funds to pay off maturing debts, Benpres is looking into the possibility of unloading its stake in MNTC.

Benpres said earlier that the sale of its 30-percent equity participation in MNTC might take place soon since discussions are now ongoing with unit First Philippine Holdings Corp.

Other assets Benpres may divest to bring down overall debt to a more manageable level are interests in Sky Vision’s Beyond Cable and Rockwell Land Corp.

Benpres said the divestment of its 24.5-percent stake in Rockwell might take a while due to the prevailing slump in the real estate market.

Angel Ong, Benpres vice-president for finance, said earlier the company expected to raise about $200 million from the sale of shares in its subsidiaries.

Benpres is seeking to reschedule repayments of its $596.9 million (approximately P30.9 billionm) in debts in order to execute an orderly divestment of certain assets.

Credit Lyonnais was appointed as financial adviser to assist Benpres in the debt restructuring program of its troubled subsidiaries and address means to strengthen the group’s capital structure.

It was also tasked to search for a new investor in Benpres’ water utility unit Maynilad Water Services Inc.