Divided we… can’t borrow

The family rift at the Ortigas clan’s flagship property firm OCLP Holdings is causing much more than delays to potential takeovers by perennial rival suitors Ayala Land Inc. of the Zobels and the SM Group of taipan Henry Sy, both of which remain acquisition-hungry.

Biz Buzz sources said the problem was affecting even the fundraising options of the builder, best known for its retail developments like the Greenhills Shopping Center and parts of a namesake business district in central Metro Manila.

With an initial public offering still off the table given legal issues between the two major Ortigas factions, each with a significant but minority stake, raising money via the debt market seems to be the way to go given OCLP Holdings’ massive Pasig, San Juan and Quezon City projects in the pipeline.

This is indeed something OCLP Holdings is planning: A debt sale valued at about P6 billion this year, it announced recently. Easy enough for a company with a well-known name and enviable asset-base, a lot of which is comprised of steady recurring income, right? Well, maybe not so easy, more so for banks that have to pony up the cash, to lend to a company that effectively has two boards. Banks would need a board resolution from the company before approving such a loan. But which board? That issue, of course, was sparked last year by a meeting where the board of OCLP Holdings was partially revamped with names friendly to the Zobel camp after the Roman Catholic Archdiocese of Manila, which has a tie-breaking 9-percent stake, sided with the Ayala Land-backed faction last year. The SM-supported faction responded that this was in violation of a binding shareholders’ agreement, setting into motion various court filings still pending with our legal system.

Nevertheless, unlike other outstanding issues, company insiders remain optimistic that there is a solution to the current impasse. Already, there are talks within the builder mainly through five common directors in both boards. And why shouldn’t they come together? The funds would be good for OCLP Holdings, which continues to grow its residential sales, office and retail units. Revenues next year could hit P5 billion after expanding its key retail developments, an official recently projected.  That sounds like five billion reasons to reach a compromise. Miguel Camus

SCTEx with strings attached

After a long and winding road, the Metro Pacific group of businessman Manuel V. Pangilinan and the Bases Conversion Development Authority (BCDA) have finally obtained an approval-in-principle from the Palace to pursue the renegotiated contract (containing improved terms for the government) over the Subic-Clark-Tarlac Expressway (SCTEx) concession but apparently, there are strings attached, according to the grapevine.

To recall, the SCTEx contract was bagged by the Metro Pacific group shortly before the Aquino administration took over but was subjected to a renegotiation in 2011. The renegotiated framework was submitted for Malacañang’s approval last year.

We heard that Malacañang’s imprimatur was given upon the condition that the renegotiated terms would be subjected to a Swiss challenge, which means the government can accept rival offers but as original proponent, the Metro Pacific group has the right to match the best counter-offer. Potential counter-bidders included San Miguel Corp. and Ayala Corp. (The Metro Pacific group was considered the sole eligible bidder for SCTEx in 2010 after rival Northlink Tollway Management, a joint venture between SMC and Star Tollways Corp., was declared short of the technical requirements.)

Sources said that this Swiss challenge condition would be to ensure utmost transparency in the SCTEx bidding process and so that the government could get the best terms from the much-coveted tollroad project. Doris C. Dumlao

Volkswagen sedans

Conglomerate Ayala Corp., which opened its first Volkswagen car dealership unit three months ago in Bonifacio Global City, has rolled out a new line of sedan cars and is breaking ground today (Wednesday) for a new dealership shop in Cebu.

After launching the sub-compact sports utility vehicles last year, the Ayala-run Volkswagen dealership has launched its first two new sedan car models: Polo 1.6-turbo diesel engine manual and the Jetta 2.0-turbo diesel at respective “special” introductory prices of P888,000 and P1.098 million. By the end of February, Volkswagen will also roll out the gas versions of earlier launched SUVs after resolving concerns on the quality of fuel sold by Philippine petroleum retailers. The gas versions of Jetta and Beetle will also be available to the local market by March.

“There was some concern on fuel additives, but that has been resolved. We’ve shown that it’s only a few that have fuel additives and that it’s not pervasive,” said Ayala Automotive head JP Orbeta.

Meanwhile, Orbeta said that after today’s ground-breaking, the Volkswagen dealership unit in Cebu is targeted to open its doors to the public by the third quarter of the year. “Before mid-year, we hope to break ground in Alabang and also looking at Quezon City early next year,” Orbeta said.

Volkswagen is the third car brand to be carried by Ayala Automotive, which is also distributing Honda and Isuzu cars. Doris C. Dumlao

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