Dennis Uy's conglomerate is willing to part ways with its crown jewels as part of an asset-sale plan to pay down debt.
The president of Udenna Corp., who was with Uy for the interview, said that discussions are in the early stages and that they are ripe to close in the coming months. The leaders of several units were in attendance. The group is open to offers even though they prefer not to sell the majority of Phoenix.
Udenna doesn't object to an attractive offer if it helps cut debt further.
The asset-sale plan follows years of credit- fueled expansion by Udenna, which included investments in a gas platform operator and a school. In July, the business empire made headlines after one of its units received a default notice from its creditor, which made the company's CEO skip dinner. Udenna said the matter is now resolved.
The executives wouldn't give a figure for the group's total debt, but public records show its borrowings. Uy's venture with China Telecommunications Corp. took out more than $1 billion in loans from Chinese banks. At the end of 2020, Udenna has debt of over three billion dollars.
The China Telecom partner in the Philippines is looking at profit for venture.
Uy said that they knew how to sell and buy. It is not easy because everyone is part of the family.
The group is looking to sign a $4.1 billion loan by the end of the year.
Uy said that selling assets is an emotional one for him as the company is responsible for thousands of families.
Uy said he should have brought in strategic partners instead of making the decision to use debt.
The conglomerate sold a stake in its casino ventures to a billionaire who is also buying a stake in an offshore gas project. The entire holding in 2 GO was sold by the company.
According to Temporal, Phoenix is the most valuable asset of Uy. He said that the country's largest inter-island shipping company would have to sell its assets to monetize.
Uy, who made a name from oil trading, began his expansion and deal spree after the election of the former president. Both of them hail from the south of the island. The shipping and energy mogul, who contributed to the campaign of the leader and counts him as a family friend, defended his expansion in an interview last year. He has built assets that have eaten into industries ruled by the country's richest families.
There was a strong belief that the economy will improve and that's why we expanded too fast.
Uy's businesses are at risk of insolvency due to the group's debt load and the Pandemic. The Altman-Z score for four companies owned by the businessman shows more risks than the average for the Philippines index, which is already the worst in Southeast Asia.
It's true that we're wounded. Who else is not. Uy made a statement. Making it right is what we are doing.
Cecilia Yap helped with the project.
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