Sitting on its assets

/ 12:13 AM March 28, 2016

HOW dare the Philippine Stock Exchange, the venerable PSE, sat idly by on its butts as listed companies like BHI broke the heart of multitude of stockholders!

“BHI” is the ticker tape name of Boulevard Holdings, billing itself as owner of other companies in hotels and resorts, and other tourism businesses.


In the dreary stock market of today, investors already accepted that BHI indeed fell on hard times—well, dangerously hard times.

In fact, the market inflicted a punishment on BHI that was not only humiliating to its management but was also brutal to its stockholders: Its price toppled to 6 centavos per share, less than the cost of the security paper of its stock certificates.


In other words, at its current price, the once promising BHI shares would not even be worth the paper it was written on—at least to its poor stockholders.

Remember that some 60 percent of the billions of shares of BHI were on free float, meaning, the investing public held the shares ever since its IPO in 1997.

As its defense when stocks turned sour, the PSE would point at the “free market” as the factor behind the falling out of certain stocks from market graces.

The PSE would use exactly the same reason even when the listed companies embroiled themselves in some unsavory things—or perhaps even illegal maneuvers.

In a recent disclosure to the PSE, which appeared in major dailies, BHI claimed it had spent P195 million on one property in Boracay, seemingly all for nothing.

That should be the 2,564 square-meter prime beachfront in Boracay, the internationally renowned getaway island off Aklan province.

The property was said to be worth more than P500 million today, and since the 1980s, it boasted of an upscale hotel resort known as Friday’s.


Through one of its subsidiaries that operated the resort, BHI has been entangled in various long-running court battles over control of the property.

The chair of BHI, Jose Marcel Panlilio, recently disclosed to the PSE that BHI had spent P195 million to solve its problems in the Boracay resort, apparently to dispel chitchats that BHI was sitting on its assets at the expense of stockholders.

He even reportedly disclosed that part of such a huge expense, using the money of stockholders, went to payments to the police. What?

The BHI group last year actually tried to take over the property—rather forcibly—with the use of sheriffs and uniformed armed personnel.

Again, again—For such a questionable action, BHI used the money of its stockholders! And the PSE just did nothing?

The question should be a simple one: Why did BHI have to pay off policemen?

For the sake of action stars in jail, the owner of the beachfront was actually the Yap family, which leased it in 1989 for 25 years to an Australian national who started and operated Friday’s resort.

Enter BHI, as it later on took full control of the operation of the resort when the Australian national reportedly passed away.

Incidentally, as BHI positioned itself at that time as a leisure and resort company, with its stocks becoming the darling of the stock market.

Unfortunately, the original lease on the beachfront property was to expire in 2014.

Lo and behold, all of a sudden, the BHI already claimed ownership of the entire lot, supposedly through a “compromise agreement” with the husband of one of the heirs of the original owners, husband and wife Benjamin and Pilar Yap.

The heir happened to be Mila Yap-Sumndad, whose estranged husband, lawyer Daligdig Sumndad, reportedly entered into a deal with BHI, in effect a sale of the property to BHI for some P40 million.

In the various court cases that both sides—the Mila camp, on one hand, and BHI, on the other—were involved in,  the Mila camp claimed they had no knowledge of that particular deal.

From what I gathered, even husbands must get the consent of their wives upon getting themselves even into infinitesimal contract, such as a car loan.

Anyway, the BHI presented to the court such documents as “tax declaration” covering the highly priced Boracay property.

In the same court cases, the Mila group claimed the tax declaration, supposedly under the name of the BHI subsidiary, was fake.

The Mila group claimed that, since BHI entangled them in all sorts of court cases all these years, they had to borrow P74 million to pay for litigation expenses.

Unfortunately, the cases were not resolved, and the group could not pay the loan that became due and demandable.

To raise the money to pay the loan, the Mila group opted for an auction of the property, which the court had—in one of those many cases—approved.

That was when BHI tried to take over the property, ostensibly with the use of armed personnel that its chair called “police” in a disclosure to the PSE.

The Boracay resort called Friday’s seemed to be the strategic business in all the other undertakings that BHI had been promising to its stockholders.

Again, based on its disclosure to the PSE, the company had spent P195 million on the Boracay resort—despite its shortage of cash, mind you.

Reports noted that, to pursue its other Friday’s project in Puerto Galera in Mindoro, BHI wanted to sell its glamorous Puerto Azul property.

Word went around that BHI was talking to the Ayala group for the sale.

When negotiations between Ayala and BHI collapsed, rumors also went around that BHI was talking to the Rockwell company of the Lopez family, and then to Megaworld of Andrew Tan, and then to the DMCI group.

Now, the Ayala group declared it would go for upscale tourism projects—such island resorts in Apulit, Lagen, Miniloc and Panulasian in Palawan, in which the room rates could run up to some $300 a night.

Question: If that was the case, and the Ayala group wanted to pour obscene amounts of investments into resorts, why did it abandon the talks with BHI?

The Puerto Azul property of BHI, located as it was in Cavite a couple of hours drive from Metro Manila, would still be a huge project for the Ayala group at more than 260 hectares.

Unfortunately to the poor stockholders of BHI, the company failed to raise the money from the sale of its Puerto Azul property that could finish its other resort projects.

For instance, BHI suspended its project in Mindoro, now only 70 percent complete, and the company even owed its contractors some P30 million.

BHI, at one time, also reported to its stockholders that it would need some P150 million more just to finish the Friday’s project in Mindoro, on top of the P195 million that it spent on the Friday’s resort in Boracay, which nevertheless BHI has buried into a hole of court cases after court cases.

Guess what—it promised its stockholders that it would soon raise the funds from the sale of the Puerto Azul property to the Ayala group that never happened.

And the PSE just sat idly by.

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