Equinaire Holdings Limited has moved to foreclose on Makilala Holding Limited’s 40% interest in Makilala Mining Company Inc. (MMCI), further intensifying the ownership and control dispute surrounding the MCB Copper-Gold Project in Kalinga.
Equinaire, a wholly owned subsidiary of India-listed Kiri Industries Limited, submitted a US$5.01-million credit bid during the September 8 foreclosure auction. With no competing bids, Equinaire was declared the winning bidder, according to a September 9 announcement by Celsius Resources Limited.
The foreclosure stems from a US$10-million secured loan originally extended to MMCI by Maharlika Investment Corporation, the Philippines’ sovereign wealth fund. Equinaire later acquired the rights to the loan.
The dispute centers on MMCI’s shareholding and governance, including a Notice of Relinquishment issued by MHL requiring Sodor Inc. to return its MMCI shares after Sodor allegedly failed to complete payment for its 60% interest within the agreed deadline.
Equinaire relied on the Notice of Relinquishment as an alleged Event of Default in pursuing foreclosure against MHL’s shares.
Kiri has described its acquisition of the loan rights as a “precursor transaction” that could provide preferential access to MMCI’s future copper production.
Celsius, however, disputes that a valid and continuing default occurred and challenges Equinaire’s entitlement to foreclose on MHL’s interest.
While Equinaire emerged as the winning bidder, its legal entitlement to the shares remains subject to arbitration.
The dispute also involves Sodor, PMR Holding Corp., Kiri, and Atty. Julito “Sarge” Sarmiento, who Celsius has identified as its former executive chairman and an adviser to Sodor, PMR and Kiri.
Celsius has also announced an Anti-Dummy Law complaint against Sarmiento involving alleged corporate arrangements with Kiri executives. Separately, a disciplinary complaint has been filed against Sarmiento and other lawyers associated with Sarmiento Loriega Law.
The allegations have yet to be established by a final judgment, and the available public record does not establish that the various transactions were part of a single scheme.
Meanwhile, Celsius shareholders have raised concerns with Philippine authorities over the dispute.
In a September 1 letter, the Securities and Exchange Commission said allegations involving possible legal violations, including under the Anti-Dummy Law, had been referred to the National Bureau of Investigation.
The referral does not constitute a finding that an offense was committed.
The dispute is unfolding as the government seeks to attract responsible investment and develop the Philippines’ critical-minerals industry under Executive Order No. 122.
The outcome of the dispute could affect ownership of the MCB Copper-Gold Project, the interests of its shareholders, and the parties involved in its financing and development.
