Category: Banking & Finance
Published on Sunday, 18 November 2012 19:00
Written by Jun Vallecera / Reporter
A CONSORTIUM of lenders led by Banco de Oro Universal Bank has agreed to restructure P1.8 billion worth of loans owed by ethanol producer San Carlos Bioenergy under new management headed by entrepreneur Menardo R. Jimenez. The loan restructuring was seen to help fast-track the company’s recovery from operational losses traced to the unfortunate combination of bad market conditions and government inattention. But no matter the unfortunate turn of events, Jimenez, who still owns about a third of GMA-7 television network, was asked to take over the bio-ethanol producer and took on the challenge to become a prime mover at the enterprise where he previously had only a minority role before. According to Jimemez, the BDO-led consortium also agreed to restructure and extend the P1.8-billion loan another five years. He said the enterprise has started to turn around in recent months and was likely to give its shareholders dividends after seven years. Jimenez said BDO, China Bank, and the state-owned lenders Land Bank of the Philippines and the Development Bank of the Philippines were ready to foreclose on the loan when he was asked to take over from the majority shareholders. “This is my biggest gamble thus far. But I am confident we can turn its operations around,” he said of San Carlos Bioenergy that he now heads as chairman with son Joel Jimenez as president. The business delivers all its 30 million-liter annual ethanol production exclusively to Petron Corp. who by law has to ensure the gasoline produced by its refineries was mixed with at least 10-percent ethanol beginning January last year. There are ongoing plans to ramp up its ethanol production to 40 million liters. Reports indicate San Carlos Bioenergy sold ethanol at prices lower than its production cost, in part...