WATERFRONT PHILIPPINES Inc., the holding firm for the Gatchalians? hotel, resorts and casino businesses, is seeking up to P2 billion in fresh credit to settle debts owed to Philippine National Bank and to boost funds for the upgrading of its hotel chain.

In a disclosure to the Philippine Stock Exchange Monday, WPI said its shareholders approved in an annual meeting the conversion of up to P600 million of its advances to Waterfront Cebu City Casino Hotel Inc. into common shares of this subsidiary at par value.

Stockholders also authorized WPI to apply for loans or credit accommodations from any banking, financial, investment or lending institution or entity willing to act as principal, co-maker, surety, mortgagor, pledgor, assignor, or guarantor for the restructuring or refinancing of the PNB loan.

Part of the loan proceeds will be used for the renovation and upgrading of Waterfront hotels in Cebu City, Mactan City, Davao City and Manila.

WPI has about P1.6 billion in loans payable as of end-September, records showed.

PNB earlier threatened to seize the two Waterfront hotels in Cebu and filed foreclosure proceedings at the Lapu-Lapu Regional Trial Court. WPI avoided the foreclosure with the help of a third party.

On Feb. 19, Cosco Prime Holdings Inc. executed a deed of assignment with PNB, with the conformity of WPI. Under this, Cosco agreed to pay P826.49 million to acquire all the rights, interests and participation of the bank in the settlement agreement as well as in the extrajudicial foreclosure proceedings initiated.

After a month, Cosco agreed to defer any action against WPI in exchange for the following:

a pledge on the Gatchalians? investment in shares of stock representing 60 percent of the outstanding shares of stock of Waterfront Mactan Casino Hotel Inc. and 60 percent of Waterfront Cebu City Hotel;

assignment of leasehold rights over the parcel of land where Waterfont in Cebu and Mactan are, and

chattel mortgage of the furniture, fixtures and equipment of the two flagship hotels in Cebu in favor of Cosco.

The PNB loan originally represents a $30-million long-term debt acquired by the Waterfront group in 1997 to partly finance the construction of the Cebu City hotel. The loan underwent several restructuring resulting in the conversion of the loan currency from US dollars to pesos?at the time that the peso was devalued during the onset of the Asian currency crisis.