RFM to meet its bond obligations

RFM Corp. and its wholly owned subsidiary, RFM Capital Ltd., disclosed that it has started initial discussions with bondholders, where RFM gave the assurance that it shall fully meet its obligations to the bondholders, and that it shall immediately allocate, through an escrow fund in favor of the bondholders, the proceeds from the recent sale of its shares in Consumer Bank and Psi Technologies and its tuna brand which should total to around $38 million.

According to RFM chief financial officer Meldin Al G. Roy, RFM currently estimates the outstanding bond obligation at $56 million, which includes the put premium.

RFM indicated that it was able to work earlier on a reducton of its obligation through bonds buy-back and refinancing arrangements.

Roy said that with the $38-million funds it has now, it will be able to settle around 68 percent of its current obligation. The balance of $18 million should be a very manageable amount that will be mainly sourced from operating cashflows.

Roy added that the repayment plan for the remaining $18-million obligation is currently being worked out with the bondholders and they expect to successfully conclude very soon a mutually beneficial arrangement and timetable.