Interested parties in VMC have till today to submit bids

Victorias Milling Corp. has given the different interested parties until today to submit their final bids for the P300-million capital infusion needed by the sugar firm for its rehabilitation program, STAR sources revealed yesterday.

Among the parties that have expressed interest in injecting new capital into the company are JG Summit Holdings Inc., Bukidnon Sugar Milling Corp.’s Julio Sy, an unidentified party represented by the Filipino-Singaporean investment house ATR-Kim Eng Capital, and Filinvest’s Andrew Gotianun.

The Securities and Exchange Commission (SEC) under the rehabilitation plan for the publicly-listed sugar firm required it to come up with P300-million in new capital until April 15. However, VMC has asked the SEC to extend the deadline by at least 60 more days.

The decision to seek additional time to inject new capital into the firm came on the heels of a string of offers from several groups, led by the JG Summit of the Gokongwei group, to provide the required funding.

According to two sources, VMC’s choice will depend on the attractiveness of the terms of the P300-million loan that will be offered.

VMC president and CEO Arthur Aguilar said the company’s 11-man board, now controlled by the creditor banks, opted for transparency in the bidding to make it more competitive and result in a more advantageous offer for the company.

Last week, JG Summit proposed a total P2.3-billion buyout package to the sugar milling firm, with the P300 million as capital infusion in the form of a senior loan convertible to equity and P2 billion to "acquire all the rights, title, and interests of both VMC unsecured and secured creditors over their respective VMC shares, VMC convertible notes, and remaining debt and accrued interests."

Last December, VMC stockholders approved the firm’s quasi-reorganization and elected a new set of directors led by Philippine National Bank executive vice president Omar Byron Mier as chairman.

Under the quasi-reorganization, VMC’s creditor banks converted P1.1 billion in loans into about 70 percent of VMC’s equity, while another P2.4 billion in debts will be restructured into a 15-year term loan.

VMC, the largest sugar mill operator in the Philippines and one of the largest in the Southeast Asian region, has been under a debt relief program with the SEC since mid-1997 as it incurred heavy losses from operations due to the prolonged slump in the sugar industry at the time.