MANILA – STI Holdings and the Benitez Group are in a tug-of-war over the control of the Philippine Women’s University following disagreements over a three-year old joint venture deal between the two parties.
According to STI, the Benitez group failed to meet their obligations under their deal sealed in 2011 after PWU head Francisco Benitez called to terminate their agreement with STI.
STI served PWU and Unlad Resources Development Corp. with notice of default, to a disclosure to the Philippine Stock Exchange. STI then demanded P702 million from PWU and P223 million from Unlad to cover interest, penalties, lawyers’ fees, and taxes within seven days.
Also, STI is looking at controlling two-thirds of voting rights in the board of PWU.
In a statement from STI, it “bailed out” PWU in 2011 after Banco de Oro Unibank was about to close out its assets. STI covered the debt paper amounting to P223 and lent the school P26.5 to help it. STI also lent P198 million to Unlad.
Under the agreement, PWU would pay STI by converting its loans into 40-percent equity in Unlad. Moreover, the Benitez group would also raise a capital of P1.5 billion.
However, during the joint board meeting of PWU and Unlad, Benitez called for the termination of their joint venture agreement with STI.
“We came to help PWU and expect to get paid through shares of stocks. After three years of waiting, it now appears the other party has no intention of living up to its end of the agreement. The notices of default were a last resort but necessary to protect the interest of the company and its shareholders,” STI said.
If the Benitez Group will not be able to pay within the set deadline, STI will involve its agreements that will require the Benitez Group to give STI control of PWU’s general membership and board of trustees, and the real properties of PWU and Unlad, and the campuses in Manila and Quezon City.