Local tobacco firm enters into compromise agreement with Netherlands Insurance

Listed tobacco processing firm Philippine Tobacco Flue Curing and Redrying Corp. (TFC) has come up with a compromise agreement with the Netherlands Insurance Co. for the settlement of a pending case for insurance claims from a 1991 fire that razed the company’s properties in Ilocos Sur.

TFC corporate secretary Rafael Antonio Santos said since the compromise agreement fully settles the case, "the parties shall hereafter file a joint motion to withdraw petition with the Supreme Court and joint manifestations with the Court of Appeals and the trial court, attaching thereto a copy of the compromise agreement."

The subject case involves the claims of the company for insurance proceeds from its fire insurance policies issued by the Netherlands Insurance Co. covering the properties in Candon, Ilocos Sur which burned down during a fire in March 1991.

The company did not disclose how much it was seeking from the fire insurance claim as well as the terms of the compromise agreement.

TFC, incorporated in 1951, is principally engaged in curing, redrying, sale and export of Virginia tobacco leaf. It pioneered the development and culture of flue-cured tobacco in the Philippines, with its original tobacco re-drying plant in Balintawak, Quezon City and tobacco warehouses in Baesa, Quezon City.

For the past couple of years, the company has ceased buying and processing flue cured Virginia tobacco for its own account, instead maintaining enough key trained personnel to process the burley tobacco from supplier Mindanao Burley Corp.’s corporate growing scheme.

For its fiscal year ending August 2001, TFC reported sales of P47.4 million, a sharp decrease of 62 percent from the previous period, due to the continued weakness in the demand for tobacco products.