In a disclosure to the Philippine Stock Exchange, SMC said the bank consortium will be led by the state-owned Development Bank of the Philippines (DBP).
Under the agreement, the lenders will provide the loans to SMC by relending their respective availments under the Environmental Infrastructure Support Credit Program II of the DBP.
The loans shall be payable in five years from the date of the initial advance, in equal quarterly installments to commence at the end of the second year from the date of initial advance.
SMC said the loan facility will be used for the establishment of a P6.7-billion recycling plant that will produce environment-friendly packaging materials for the local food and beverage industries.
The project will utilize state-of-the-art technology approved by the US and European Food and Drug Administrations to process post-consumer plastic bottles and convert these into food-grade packaging materials and containers.
The recycling plant will be established in San Fernando, Pampanga and is scheduled to start operations in May 2004.
SMC said such system will be the first of its kind in Asia. Aside from plastic recycling facilities, the project includes facilities designed for the fabrication of plastic closures.
SMC said plastic has taken global markets by storm as the material of choice for beverage bottles. The format offers good design, flexibility and safety, is also lighter and occupies less space than most other alternatives.
The company said used-plastic packaging can be recycled into food-grade containers, fiber for clothing and carpets using a variety of recycling procedures.