A Thai shareholder in a residential development company on the outskirts of the city said the International School of Phnom Penh has rejected a proposal to take over the development company’s own financially struggling school.
Bangkok-based Finansa Ltd, a major shareholder in the yet-to-be-constructed Northbridge Communities development, last month proposed to the ISPP that it move from its Norodom Boulevard site to the school building at Northbridge, according to Finansa Managing Director Eugene Davis.
The merger would have meant the exit of the International School of Cambodia, which opened just last year at the development with about 30 students from grades kindergarten to eight.
ISPP Director Michael Francis declined Monday to discuss the negotiations with Finansa, citing previous requests by Finansa to keep the proposal quiet.
Davis said Monday the proposal was not a reflection of the quality of the ISC, but a financial move. The school opened a month after the July 5-6 clashes, which sent Cambodia’s economy into a tailspin. The number of grades taught and teachers hired were reduced, ISC officials have said.
Davis said the ISC, which cost more than $8 million, is expected to lose about $500,000 in its first year and $200,000 in its second.
“For financial reasons, we thought we should consider the options,” Davis said. “We thought a safer strategy would be to unify everything.”
This is the second time Northbridge and ISPP have discussed collaboration. Northbridge initially asked ISPP to run the school at the 58-hectare residential development and the school was instrumental in choosing the site, Davis said.
However, those close to the talks said negotiations floundered over who would have ultimate control of the school, and the deal dissolved.
The second attempt, according to Davis, has collapsed over the issue of money.
Davis said Finansa made several proposals, including a lease with a fee of about $1,000 per student and a buyout option. The ISPP board, Davis said, thought that price was exorbitant. And the board’s demand that a 1-km road from Pochentong Boulevard to the school’s site be paved—a cost Davis estimated at close to $1 million—was unacceptable, he added.
Last week, the ISPP board rejected the proposal, although Finansa had yet to put anything formal on paper, Davis said.
Francis of the ISPP denied the board had broken off discussions with Finansa, but when asked whether there were plans for future negotiations, Francis said he could not discuss them.
Finansa and Northbridge have no plans, however, to back out of the project or look for another partner. And Davis said he hopes enrollment will pick up after July’s scheduled elections.
“We’ll go ahead and continue to do our own thing,” Davis said.
The residential part of the project also suffered following the clashes. Contracts for 40 units were canceled, interest has dropped off and construction is now two years behind schedule, Davis acknowledged.
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