Bank OKs rehab plan for Reynolds

Asiatrust Bank has approved a rehabilitation and financial restructuring plan aimed at reviving the beleaguered aluminum manufacturer, Reynolds Philippines Corp. (RPC).

In a disclosure to the Philippine Stock Exchange (PSE), RPC said Asiatrust is the second creditor to approve the plan. The first was Land Bank of the Philippines.

RPC senior vice president Jose Cervantes said the company’s financial adviser, Penta Capital Investment Corp., has expressed confidence that it would be able to get the approval of at least 67 percent of RPC’s creditor banks.

However, Cervantes also disclosed that country to earlier reports, RPC has no knowledge of any new investors that have expressed interest in rescuing RPC out of its financial woes.

It was reported that the Landbank is negotiating with possible investors to figure out a way of restructuring RPC and possibly reopening its manufacturing plant in Cavite.

But Cervantes said RPC is not aware of any new prospective investor that has expressed interest in saving RPC from its financial troubles.

"Neither are we aware that the Landbank is undertaking negotiations with regard to this matter," Cervantes said. RPC’s restructuring plan would involve the restructuring of the company’s secured loans into seven-year loans and the conversion of unsecured bank loans into equity of the company.

This will effectively transform RPC into a new entity with majority ownership held by banks loans into equity of the company.

RPC had expressed optimism that the approval of its restructuring plan would enable the company to raise around P400 million of last-in, first-out (LIFO) funds to finance importation of raw materials and provide working capital.