NEGROS NAVIGATION COMPANY (NENACO) does not have to scout for a third party to obtain the remaining P127-million funding required for rehabilitation, according to Metro Pacific Corporation.
In a disclosure to the Philippine Stock Exchange (PSE), Metro Pacific vice president David Nugent said the parent company will provide the needed funds that will enable its cash-strapped subsidiary to return to profit.
He said half of the amount has already been turned over to NENACO, with the balance to be given this month.
“Metro Pacific has already begun providing such funding to NENACO. As of last week, Metro Pacific had already provided P63.5 million to NENACO and is on schedule to provide a second tranche of an additional P63.5 million to NENACO in November,” he said.
Nugent disclosed the money was given as an “inter company advance,” and will be repaid under commercial terms and in line with the shipping firm’s rehabilitation program.
He added the P127 million will be sourced from funds obtained from the sale of Metro Pacific shares by parent, Hong Kong-listed First Pacific Co. Ltd.
The mother firm recently sold approximately 5% of the total issued common share capital of Metro Pacific, primarily to support the corporate rehabilitation of NENACO.
The shipping firm, soon to be delisted from PSE, needs the P250-million fresh cash based on the recovery blueprint approved by the Manila Regional Trial Court.
The amount will be infused into NENACO periodically beginning this year until mid-2005 to pay the shipping firm’s tax liabilities, repair M/V St. Ezekiel Moreno, and for drydocking costs of two of its vessels.
