GIHL sweetens final offer for NSC to P13.25-B

Global Infrastructure Holdings Ltd. (GIHL) had sweetened its final offer for National Steel Corp. (NSC) to P13.25 billion with P1 billion cash up front upon reaching a deal with the creditor banks.

The balance of P12.25 billion would be paid over eight years.

GIHLs original offer was P11.905 billion payable over 10 years and an up front cash of P655 million.

The new offer was confirmed yesterday by sources from the creditor banks who further disclosed that an informal deadline of Jan. 15, 2004 has been set for all of the creditor banks to approve/accept the offer of GIHL.

The sources explained that even if one or two creditor banks do not approve/accept GIHL’s offer, a majority approval/acceptance would be enough to seal a deal with GIHL.

A separate approval/acceptance would have to be secured from the Malaysian Danaharta Group. According to the sources, Danaharta is inclined to go along with the creditor banks.

GIHLs offer would likely be accepted and the banks would no longer entertain the LNM Group which continues to express interest in NSC, sources said.

They said that GIHLs offer was clearly superior to the LNM Groups proposal which relied on a profit-sharing component that would reportedly provide the banks with a total net present value five percent to 10 percent higher than GIHLs offer.

GIHLs offer, the sources pointed out, provided for hard cash regardless of loss or profit.

The defect of LNMs offer, the sources clarified, is that if there is not profit, the banks would get nothing.

Thus, the LNM Groups offer, the sources said, is iffy.

The LNM Group is still hoping that it can present its updated offer to the banks once the exclusivity period of negotiation between GIHL and the banks expires in February.

If the banks are able to give their approval by Jan. 15, a formal agreement with GIHL can be signed one to two weeks after, the sources said.