Pre-need firm TPG Corp submits self for court rehab
By Zinnia B. Dela Peña
The Philippine Star 02/16/2006
In line with its plan to transform itself into an investment holding company, pre-need firm Professional Financial Plans (TPG Corp.) has sought corporate rehabilitation with the Makati Regional Trial Court.
TPG is the fourth pre-need firm to seek refuge from the court for a moratorium on its debt payments to ensure continued operations.
In a press briefing yesterday, TPG chairman Francisco Colayco said the company’s move to seek the court’s intervention was in line with efforts to implement its STEP-UP program, aimed at recovering from its liquidity problems and ensuring the orderly settlement of obligations to planholders.
TPG’s trust fund is currently valued at between P800 million to P900 million while its liabilities stand at P1.1 billion.
The STEP-UP (Scholars Trust Fund with Equitable Pay-out for Unified Preservation) program calls for preserving the pre-need firm’s trust fund and reserving a portion of scholars’ availment benefits as equity in a financial holding company that will have interests in a diverse portfolio of financial services.
"In subsequent discussions with the SEC (Securities and Exchange Commission), it was determined that without 100 percent planholder consent to the program, the SEC can neither approve nor disapprove STEP-UP. Given that 100-percent approval is not only highly improbable but physically impossible, the only available option to ensure achievement of the STEP-UP objectives is to seek a court mandate for its implementation," Colayco said.
"We did everything possible to reach majority of our customers. With an 80 percent on-the-spot success rate in converting our planholders, we feel very good about our plan’s acceptance," Colayco further said.
When TPG is finally converted into a holding company, planholders will be rewarded because their educational plans will be converted into common and preferred shares in the new company, thus making them shareholders of the new company.
Also in line with its vision to become an investment holding company, the company is planning to acquire a thrift bank and put up a nursing school for the benefit of its planholders.
Colayco stressed that TPG has consistently served its planholders for the past 30 years. Since 1992, TPG has paid over P2.7 billion in plan benefits, he said.
"We would like to assure everyone that our commitment to the vast majority of our planholders stands. We only ask for a little more patience and for their prayers for the speedy approval of our plan, "Colayco said.
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