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Business

AIF files suit vs Benpres, BayanTel

- Christina Mendez, Conrado Diaz Jr. -
The AIG Asian Infrastructure Fund (AIF) has filed a civil suit against the Lopez-controlled Benpres Holdings Corp. and its subsidiary Bayan Telecommunications Holdings Corp. over the payment of the option shares AIF has invested in Bayantel.

Benpres corporate secretary Enrique Quiason told the Philippine Stock Exchange that the suit was filed last Dec. 19 before a US federal trial court in New York, alleging violations of the US federal securities law and the New York state law.

The suit covers Benpres, Bayantel, certain officers and directors and others involved in the placement of the option shares.

The complaint, Quiason said, alleges that the defendants, including the placement agent in the sale of the convertible preferred shares of Bayantel, "failed to disclose to AIG at the time it purchased such shares that certain institutional stockholders of Bayantel had a pre-existing put right to Benpres of their common shares in Bayantel."

AIF had purchased convertible preferred shares of Bayantel, one of the most debt-laden units of the Lopez Group, in 1998 which are guaranteed by Benpres and due to mature on Jan. 16, 2003 with a maturity value of $44.8 million.

Quiason said the case will not affect the ongoing debt restructuring plan of the holding company. Benpres intends to continue discussions with creditors of its balance sheet management plan for the settlement of all its direct and indirect obligations," he said.

Benpres, saddled with nearly $597 million in total debts, is in the middle of a balance sheet management plan, an extensive blueprint to aggressively scale down its borrowings, downsize its portfolio of investments and even divest non-core assets.

Specifically, the plan would require Benpres to reduce debt, raise capital through asset divestment and bring down costs by freeing itself from further investments and capital calls on its infrastructure projects.

vuukle comment

ASIAN INFRASTRUCTURE FUND

BAYAN TELECOMMUNICATIONS HOLDINGS CORP

BAYANTEL

BENPRES

BENPRES HOLDINGS CORP

ENRIQUE QUIASON

JAN

LOPEZ GROUP

NEW YORK

PHILIPPINE STOCK EXCHANGE

QUIASON

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