Biz Buzz: Strange bedfellows
What was only hinted at before by Zobel-led Ayala Corp. and Henry Sy’s SM Group is potentially blossoming into quite a business alliance.
Both conglomerates, after hashing out a multi-year dispute in the Ortigas family’s OCLP Holdings—whose coveted land bank SM and Ayala will now jointly develop—are inclined to join forces for the P123-billion Laguna Lakeshore project, our sources noted.
Another conglomerate, Aboitiz Equity Ventures, may also join the tandem, as Aboitiz had partnered with Ayala for a tollroad deal in the past.
The public private partnership project—which combines the tollroad business, a flood control dike and a 700-hectare reclamation in Laguna Lake near Taguig and Muntinlupa—is the largest deal to be rolled out under the present administration.
The conglomerates mentioned have yet to provide official confirmation (the qualification deadline, when the composition of the consortium will be known is on Feb 27). All the SM and Ayala groups said was that they were open to working together, after resolving the Ortigas dispute.
Rival groups hearing the same news on the Laguna Lakeshore deal have taken notice of this possible super consortium, whose members’ listed holding firms have a combined value of nearly P1.5 trillion.
Some are wondering, for instance, who Manuel V. Pangilinan-led Metro Pacific Investments will tap for the property side of the deal, given that real estate is no longer a core business of the infrastructure company.
But taking a look at the list of developers that bought bid documents, at least one is owned by a company that has links to MVP in the telecom and power generation business.
With the deadline looming for the submission of qualification papers, we expect to hear of more alliances cropping up. Abangan!–Miguel R. Camus
Yosi boosts war chest
Aside from initiating foreclosure of Philippine Women University’s Taft Avenue and Indiana Street campuses in Manila, STI Holdings has beefed up its war chest against the Benitez family by taking full control of Attenborough Holdings Corp.
Attenborough is the holding firm set up by Alfredo “Albee” Benitez to extend financial aid to PWU together with the STI group of Eusebio “Yosi” Tanco.
In short, the sale of a controlling stake in Attenborough by Albee—described by STI chief Eusebio “Yosi” Tanco as the “only decent Benitez” around —allowed STI to consolidate control of PWU’s indebtedness.
Attenborough had lent P65 million in 2012 to Unlad Resources, PWU’s sister company that would absorb the school’s assets and has likewise been declared in default of the loan deal.
While STI has held in abeyance its right to step into the management of PWU, it is consolidating the assets that backed the loans to the Benitez family.
After its representatives were ousted in Unlad, the Tanco group pulled out representatives from PWU’s board while remaining as members of the non-stock organization.
The plan is to leave all the responsibilities to the Benitez family and see how long it can hold on without financial muscle.
On the “break-up” premium reportedly offered by the Benitez family, we heard that the Tanco camp found it unacceptable. The offer was to pay P550 million if the parties reach an agreement but the Benitez family must be given time to raise the money. Such “pay-when-able” proposal did not sit well with Tanco, industry sources said.
The Benitez family, which controls PWU, said the petition for extrajudicial foreclosure had no basis as the family also questioned the computation of the P1 billion in debt claimed by STI.
The Benitez family claimed Tanco had committed to waive interest four years ago when they entered into a partnership, which meant PWU’s debt to STI was not as much as demanded by Tanco. However, the Tanco group said the waiver of interest was effective only if the debt-to-equity conversion had happened.–Doris C. Dumlao
Loco over lotto
Lottery operator Pacific Online Systems Corp. may see a windfall this year after the Philippine Charity Sweepstakes Office introduced its newest game called Ultra Lotto which, as its name suggests, offers the biggest cash payout to winners among PCSO’s many lotto versions.
According to Pacific Online president Willy Ocier, the game involves the bettor choosing six numbers out of 58, for P20 per bet.
That means a bettor has one chance in 40.4 million to win the grand prize, which starts at P50 million. Given the more challenging odds and the bigger pot, Ocier said he expected the grand prize to increase at a more rapid rate than other lotto games.
Pacific Online, of course, is the firm that holds the exclusive lotto franchise for Visayas and Mindanao, with 4,000 outlets including about 700 units in the revenue-rich Luzon and Metro Manila areas (which used to be the exclusive area of the local unit of Malaysian conglomerate Berjaya).
If you think winning with odds of one-in-40 million is easy, consider that the biggest game in PCSO’s repertoire previously was the 6/55 grand lotto where the chances of winning stood at one-in-29 million. After this was the 6/49 game with one-in-14 million, the 6/45 with one-in-8 million, and the basic 6/42 game with a one-in-5.2 million chance of winning the jackpot.
For a better grasp of the odds, National Geographic says the average person has only a one-in-700,000 chance of getting struck by lightning during any given year.
But don’t expect the steep odds of the new game (which was launched last Sunday) to deter Filipino lotto bettors—even if one has a better chance of getting struck by lightning.–Daxim L. Lucas
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