PWU seeks court protection from creditors
The 100-year-old matriarch of the Benitez family has filed a petition for the involuntary rehabilitation of Philippine Women’s University (PWU), seeking to prevent irate creditor STI Holdings from seizing assets after a soured partnership.
In a statement Monday, PWU said that the university chair Helena Benitez—also a long-time creditor of the university—filed a petition for corporate rehabilitation at the Manila Regional Trial Court “in a bid to preserve its operations after STI Holdings initiated foreclosure proceedings against the university.”
The matriarch also said that the foreclosure proceedings would prevent PWU from paying its debts and would render it insolvent. “The foreclosure proceedings … will also drastically disrupt and stop PWU’s school operations,” she said.
STI Holdings recently initiated extra-judicial foreclosure proceedings against PWU covering its Taft Ave. and Indiana St. campuses in Manila, the Jose Abad Santos Memorial School (JASMS) campus on Edsa, Quezon City and another property in Davao City.
“The foreclosure and sale of any of the properties will extremely prejudice PWU and endanger its existence or survival since the properties are vital to its operations and rehabilitation,” Benitez said.
Based on the statement, PWU owes Benitez P33.6 million. The matriarch also submitted a proposed rehabilitation plan for PWU, the goal of which was to enable the university to meet its obligations to its creditors, including STI, without disrupting the conduct of its business.
It involves a rehabilitation period providing for the sale of assets to cover part of the debts of PWU, while the rest will be paid in accordance with projected cash flow over a 10-year period.
It was noted that PWU was a non-stock, not-for-profit institution, which has been supported by the Benitez family for the past 96 years. In 2011, STI helped PWU by assuming its debt to Banco de Oro amounting to P223 million. In December 2014, STI declared the university in default of its obligations and initiated foreclosure proceedings against PWU.
From the point of view of the Benitez family, when STI took over the loan from BDO, Tanco had agreed to waive all interests, thereby challenging the default declaration in court. For its part, the STI group said interest would have been waived if the Benitez family had complied with the original agreement to pay STI in the form of shares in Unlad Resources Development Corp., which was to absorb all the real estate assets of PWU in a share-for-property swap and manage PWU. But since STI was never paid with shares in Unlad, the STI has charged interest on top of the principal debt owed by the Benitez family.
STI is demanding P923 million as payment for the loans. PWU has offered a compromise settlement amounting to P644.44 million.
Asked about this latest move, STI Holdings chair Eusebio Tanco said his group was discussing its legal options with lawyers.
“If we had not come in 2011, they would have gone bankrupt because we’ve been supporting them all these years. They kicked us out, that’s why they are now bankrupt,” Tanco said.
“There’s a conflict of interest here. She’s running the school and at the same collecting against herself,” he added.
