NSC liquidator dangles plant facilities to entice investors

The plant assets of the National Steel Corp. (NSC) will be sold as an integral facility to allow prospective buyers to resume operations as soon as the liquidation process has been completed.

The liquidation plan prepared by the government-appointed liquidator indicated that to facilitate this, the assets of the defunct steel company would be grouped into two categories: plant assets and other assets.

The plant assets, according to the plan, would be composed of the Iligan plant, including all the movable equipment and real properties directly used for plant operations.

According to government-appointed liquidator Danilo Concepcion, most of these assets were mortgaged to NSC’s creditor banks under a mortgage trust indenture (MTI).

Concepcion said separating these assets would also allow the orderly application of the disposal proceeds. The Iligan plant, he said, would be used to settle the claims of secured creditors which represent the biggest percentage of NSC’s liabilities.

NSC’s other assets, Concepcion said, would be applied to other company obligations, principally the claims by employees for unpaid retirement and separation benefits.

These assets include other real properties in Iligan, Pasig, Bohol, Makati, Antipolo and Benguet; various fixed assets; inventory of finished goods, materials supplies and accounts receivables outstanding.

Based on the plan, the assets would be either sold outright to an independent buyer or conveyed to a new operating company whose shares would be distributed among the creditors having mortgage and preference over the assets.

In either case, Concepcion said the overriding consideration in the asset disposal would be the immediate restoration of NSC’s business and resumption of the plant’s operations.

Prospective buyers, Concepcion said, would be required to meet minimum qualifications, including the capacity and willingness to operate the most number of production lines within six months to one year.

In case of the outright sale, the plan is to dispose of NSC through a cash sale or terms. The sale would be awarded to the bidder or buyer offering the best price and the proceeds would be applied based on the rules on preference of credit.