Comment/opposition to the revised rehabilitation plan of Maynilad

Comment/opposition to the revised rehabilitation plan with omnibus motion to: (1) pay the concession fees accrued after the 17 November 2003 stay order; and (2) suspend the implementation of the tariff increases

The revised rehabilitation plan of Maynilad is a  scheme to BAILOUT Benpres Holdings Corporation (“Benpres”), a 59% stockholder of Maynilad, using PUBLIC FUNDS.  Without the rehabilitation plan, Benpres would have to pay the SBLC Banks, Bridge Loan Banks and Local Banks more than US$130 million as guarantor of Maynilad’s loans.  But, under the rehabilitation plan, Benpres would only have to assign to the SBLC banks its entire shares in Maynilad at a price of US$33 million, in exchange for a release on the remainder of its guarantees.  Hence, it will be saving more than US$97
million.

However, in order to secure the SBLC’s concurrence to the plan, the MWSS must purchase from the SBLC Banks the same shares for US$33 million.  Similarly, in order to secure Suez’s concurrence to the plan, the MWSS must purchase from Suez a total of US$27 million worth of its shares in Maynilad.  In effecting this purchases, the MWSS will be using US$60 million of the US$120 draw on the performance bond which are public funds.  To aggravate matters, the MWSS will be purchasing shares the value of which have been inflated.  These and other matters are discussed in the attached comment.

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