…But From Whom?
My father believed that the education you get in grade school is the most crucial one because it sets up the foundation for all future learning and gives you a set of perspectives that will tend to guide you through most of your life.
So despite being just a government employee at Manila City Hall, he put three of my siblings and myself through Jose Abad Santos Memorial School (JASMS) Philippine Women’s University (PWU) thinking that it was the best grade school education he could get for us. After grade school in JASMS, my father put two of my two sisters through high school and college in PWU.
It wasn’t easy for my Dad to come up with the tuition (which wasn’t a small amount of money) and other school expenses every year, but he managed to come through with the money “by hook or by crook” — as he would often say.
Another reason why he persevered was because he had always thought of himself as just a kid from Quiapo and apart from wanting us to have good education, he also wanted us to make friends with kids from upper crust families — though, I sometimes wonder what he meant by upper crust because my closest friends in grade school were a bunch of dingalings. Hahaha!
Anyway, perhaps as a testament to my father’s faith in JASMS PWU, my siblings and I have all gone far in our respective fields and we’re still in touch with the friends that we made in PWU and JASMS.
Then, right smack around the time when I was reflecting on things past as I always do right around the Christmas season, I came across an article where it was announced that STI was taking over a number of seats in the PWU board and effectively taking over the institution.
The article read
The Benitez Group has bowed out of Philippine Women’s University. STI Holdings Inc., holding firm of Eusebio Tanco, now owns and operates the university.
STI in a statement released to media said the Benitezes have resigned as members and trustees of PWU on Monday after failing to settle the accumulated P923-million debt of PWU and its sister company Unlad Resources Development Corp. to STI.
STI has now eight out of 10 seats in PWU’s board of directors, and 11 of the 15 so-called members, which are actual owners if PWU had not been a non-stock corporation.
STI shouldered PWU’s debts and turned them to equity in November 2011 when it was about to be foreclosed by BDO.
STI also provided another P26.5 million and additional P198 million for Unlad to support PWU’s expenses.
At first, I thought nothing of it and shared the article on my Facebook wall, thinking that as with some of the things I loved as a kid that have bitten the dust, I guessed it was just about time for PWU. With PWU being somewhat connected to my thoughts about my father who had passed on a couple of years ago, it made me feel sad because it felt a bit like losing my father all over again.
Then, just when I thought that there was nothing more to it, two days later one of my JASMS classmates tags me in a post on Facebook decrying the STI group’s supposedly (sic) high handed manner takeover of PWU and the sentimentality of the appeal got to me.
After all, the message was from former Senator Helena Benitez herself, the revered founder of the university.
Rather than give you a rundown of what is still an ongoing word war between the Benitezes and STI, I’d rather just point you to my good friend’s post “The Curious Case of PWU/JASMS: Nothing Personal, It’s Just Business” where he sums it all up.
In all that JP wrote, this one bears emphasizing here:
But, as stipulation of facts go in any pretrial, it seems that both sides agree on this simple narration:
1. PWU/ Benitez owed BDO Php250 Million
2. The BDO loan was due and PWU was going into default.
3. PWU borrowed P480 million from STI
4. BDO was paid P250 million while the P230 million was, well, with PWU
5. PWU is now in default with the STI Group, the latter is calling in the loan.
What I would like to focus on in this post are some of the things that I found a little out of kelter on PWU’s side and as much as I would like to think the best of the Benitezes, a small voice inside my says things aren’t what they appear.
For instance, it has been 3 or 4 years since the Benitezes received a P450 million loan from the STI Group and one question that is nagging me is, why didn’t try to pay it back if they had begun to feel that their partnership with STI was going bad?
Ms. Lydia or Lyca Benitez Brown, PWU’s media center director was good enough to answer my question via email, and she told me this:
Mr. Tanco came in as an investor. That’s why in good faith, we allowed him to sit on PWU’s Board and appoint his people to run operations these past 3 years. That’s also why he suspended charging penalties and interest (in writing) for 3 years.
It was only after the JASMS deal was halted that he turned into a creditor and demanded payment of P925M in 7 days. We will pay him back the P450M he lent us but find his demands onerous (and illegal, as our lawyers will argue).
Today he announced he was holding his default demand “in abeyance” and a return to status quo pre-Dec. 22 (when they called an illegal board meeting, replaced all the Benitezes, fired Pres. Kiko, etc.). He is supposedly doing this in the interest of the students.
Thing is, it doesn’t seem like Ms. Benitez-Brown’s answer isn’t as straightforward as I had hoped and it’s only by going through an interview granted by STI’s Mr. Eusebio Tanco that one gets a glimpse of something closer to the truth.
Mr. Eusebio Tanco: Nung nangangailangan ng pera. They were begging for money. Now that they got the money, and it’s time to pay up.
Typical Benitez, when it comes to paying, they find all types of excuses not to pay. They’re saying that we’ve invested in so that we can lose money, we can fix it up. We are businessmen; we don’t invest in something just to lose money.
Mr. Jacob and I, we’ve been managing a lot of companies around and we’re really turned around artists, we turn companies around. Just look at the track record. Our track record.
If you look at the audited financial statement in 2010 and 2009; 2009, they have a loss of nearly 45 million. 2010, they have a loss of 75 million, and cumulative losses over the years of 2010, was 375 million. There was a question on an ongoing concern. The only savior then for them was STI for coming in to buy the debt paper of BDO and pumping in new money to improve the facilities.
If it is true that the Benitezes didn’t want the STI Group to have a say in how it ran the school, it should have used the loan to reinvigorate PWU so that it could generate enough revenues to pay for its debts and it should not have agreed at all to having the loan converted into equity in UNLAD — the company the holds all PWU properties.
For, what is a school without a physical location? Surely, PWU and JASMS can’t exist as an institution that it is without its buildings.
The Benitezes should have been very wary when the STI Group (as Ms. Benitez Brown claims) “suspended charging penalties and interest”, because that doesn’t sound at all as if all its obligations were voided completely or at all. As things usually go, such financial obligations would just accumulate and when payment is demanded, it will be a hefty sum that will be impossible to pay off immediately. Unless of course PWU had been tucking away loan payments and saving it up for the day when the loan payment would be demanded — which apparently isn’t the case.
Moving on further in Mr. Tanco’s interview, he goes on to point the sorry state of PWU when STI came in:
We have pictures to show you guys what was PWU before we came in. It has improved drastically. Before we came in, they were having hard time paying their salaries and wages. They are having problem paying their utilities. I’m sure it’s been written that there were leaking roofs, and flooding. I think the electricity was not sufficient; there was no air-conditioned room because the lines are too small for the electricity to pass through. We fixed up a lot.
It hurts because probably walang utang na loob after you done all of these, they don’t appreciate it. Not only that they don’t only appreciate it, that they turned the story around. They refuse to face us in a town forum, in a town hall meeting, a gathering. We challenge them if to face me and Nick (Monico Jacob). Whoever they can bring everybody that they want to bring on the forum and we’ll face them. But I think that they avoid it. And it’s kinda sad — you’re claiming yourself to be educator, and you’re totally immoral… how can you teach, how can you be an educator?
Just today, Ms. Benitez Brown came out in a news article saying that the Benitezes were taking the STI Group to court so that it could reach an agreement as to how its debt should be paid.
“Our stand remains, we’re going to pay our debt but we need to settle the issues on a fair, amicable and equitable basis. Let’s sit down and discuss what will be a reasonable return for your money,” she said.
Benitez-Brown said while the family is thankful for the help extended by Tanco that allowed PWU to avert creditor foreclosure, it is contesting the “excessive” amount payable to STI.
“We don’t have as much money as Mr. Tanco’s but we will honor our obligations. He only invested P450 million and now he wants four times the amount of the initial loan he extended. He even demanded that we paid up in just seven days. That is so unreasonable and exorbitant,”” she said.
“He wants PWU’s real estate so he can proceed with his joint venture deal with Ayala Land involving the development of the property into a condo mall project,” Benitez-Brown said.
But the thing is, it seems that the property in question (JASMS EDSA) had already been targeted for conversion by the Benitezes jointly with Jardine Land in the late 1990s.
In an article on the web, it is claimed that the Benitezes received cash advances from Jardine and when the real estate developer chose to pull out of the project, the advances were converted into loans which the Benitezes claimed that they could not pay.
So, why do the Benitezes claim to be fighting against STI to thwart PWU’s commercialization when it had previously engaged Jardine Land on a similar venture?
In ending this, I guess sentimentality has to give way to looking objectively at the situation and figuring out what would be best for the teachers and students of PWU.
After nearly a hundred years, PWU seems to be floundering financially. First with its venture with Jardine Land, then with its loan from BDO, and then again with its loan from STI. Question is, how will the Benitezes pay up if it hasn’t been able to do so with its previous loans?
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