Global Equities sets debt liquidation measures

Holding firm Global Equities Inc. (GEI) said it continues to work on the full liquidation of its debts in line with efforts to bring its stockholders equity back to positive levels.

Documents filed with the Securities and Exchange Commission showed GEI is currently holding talks for the sale of a five-hectare property in Paranaque, which carries a mortgage with United Overseas Bank amounting to P231.5 million. The property will be sold to a third-party investor on a straight sale basis, with GEI expecting to conclude the transaction not later than the third quarter this year.

GEI said it is also considering the conditional dacion en pago (payment in kind) of its shoreline properties in Batangas City for the payment of some P109 million in debts owed to banks. It will likewise condone the interest and advances made by a principal shareholder worth P74 million.

GEI is likewise in talks with prospective developers to pursue a mixed-use community development for its 140-hectare leasehold rights in the Clark Special Economic Zone.

GEI is in the final stages of a joint venture agreement with Sta. Lucia Realty Inc. to develop its 16-hectare property in Tagaytay into a residential subdivision. The land has a mortgage with Rizal Commercial Banking Corp. amounting to P70 million.

Under the agreement, Mountain Ridge Executive Resort and Conference Center Inc., which is 70 percent owned by GEI, and Sta. Lucia will share 50/50 on the estimated sales proceeds ranging from P190 million to P280 million.

After the implementation of these measures, GEI will have the following debt-free assets: leasehold rights over 140 hectares in Clark adjacent to Mimosa; 20 percent equity in Sacobia Hills Development Corp.; and 50 hectares net of Batangas City Central.

As a long-term source of liquidity, GEI remains hopeful that it can consolidate its investments through outright sale or joint ventures and raise the necessary capital to fund the development of its unencumbered real estate assets. If successful, the company expects its financial position and performance to have a positive change.

As a holding company, GEI has invested in companies engaged in the manufacture of absorbent cotton and other personal care products and in the provision of specialized corporate facilities for end-users.

Its principal absorbent cotton products are cotton rolls, balls, buds and sanitary napkins. Personal care products include liniment, isopropyl alcohol and baby oil and powder. The cotton roll line contributes at least 25 percent of total sales.

GEI posted a net income of P127 million last year as against a net loss of P742.9 million in 2002. Revenues, on the other hand, decreased to P20.9 million from P144.1 million.