Cerberus and Hyundai Subic partnership

We are extremely pleased with the announcement by Cerberus Capital Management that they have finalized a lease agreement for HD Hyundai – the global leader in shipbuilding and offshore engineering – to lease a portion of the Agila Subic facility in Subic Bay.

It can be recalled that the Subic shipyard was abandoned by Hanjin Heavy Industries that declared bankruptcy in 2019 after incurring over $412 million in debts, leaving thousands of Filipinos jobless.

We were fortunate to play a role in saving the facility during a meeting at the White House with then-deputy national security adviser Matt Pottinger to discuss the shuttered facility in Subic Bay. The administration of president Donald Trump was interested in saving the shipyard and put it to good use, such as a docking and repair facility for US ships and still make it commercially viable.

Obviously, what was important for us was to make the Subic site economically viable and get our local banks paid, plus making sure that it does not fall into the wrong hands. The process was very challenging and complex because Hanjin had a lot of lenders, both domestic and international. It took almost three years for us and then-finance secretary Sonny Dominguez to put the Hanjin project together, with leading private equity firm Cerberus emerging as the “white knight” and whose unwavering commitment resulted in the completion of the agreement in April 2022.

As Cerberus senior managing director Alex Benard noted, it was not easy to get an abandoned, 350-hectare facility back on its feet and make it operational again. I remember when we visited the site in June 2022 with members of the US-Philippines Society and Cabinet officials, several of the buildings were already rundown and dilapidated.

But in just two years since the American financial firm took over the facility through its portfolio company Agila Subic, they have managed to attract several tenants that include global subsea fiberoptic cable company Subcom, logistics company V2X and the Philippine Navy that was the facility’s very first tenant, occupying some 100 hectares in the northern portion.

No doubt Cerberus is getting closer to realizing its vision of