NDC postpones P3-B bond flotation

The National Development Co. (NDC) board last Friday decided to defer its planned P3-billion bond flotation until it receives clarification from the Department of Finance (DOF) regarding its policy of not extending any more government guarantees to cut down on contingent liabilities especially from government-owned and controlled corporations.

This was announced last Friday by NDC General Manager Arthur Aguilar following the NDC board meeting at the Board of Investments (BOI) building.

Aguilar, however, assured that even without the planned bond float, the NDC still has some P2 billion in remaining agri-agra funds.

Aguilar said the NDC would re-prioritize and even cutback on some of the projects it intends to undertake or fund.

"We will have to go back to the drawing board and look at our balance sheet. We will also have to look at what else we can do," Aguilar said.

For instance, Aguilar cited, NDC is hoping to raise some funds from the sale of its remaining assets including its 18-hectare property in Las Piñas which is currently being leased by Goodyear Philippines.

Several big real estate and property development firms such as Ayala Land Inc. and Robinsons Land Corp. are eagerly awaiting the NDC’s decision on whether it will put up the property for sale.

NDC’s 25-year lease contract with Goodyear has just expired and is up for possible renewal. However, real estate sources said that renewing the lease agreement with Goodyear will not bring in as much money for the government.

An outright sale of the 18-hectare Las Piñas property could bring in as much as P3.6 billion although not all of the proceeds would go to the government since it has a 60 to 40 joint venture with Goodyear on the development of the property.

On the other hand, another 25-year lease renewal, real estate sources computed, would only bring in less than P1 billion to the government based on a net present value computation.

Proceeds of the NDC bond float was being eyed as seed fund for the Philippine Infrastructure Corp. (PIC) which is supposed to jumpstart vital infrastructure projects.

Previous NDC bond offerings also helped financed government small and medium enterprise loan programs.