MANILA, Philippines - Listed animal feeds and livestock firm Vitarich Corp. will seek court approval to terminate a 15-year corporate rehabilitation process on the back of a regained market competence and substantial debt reduction.
In its disclosure to the stock exchange, Vitarich said its board authorized company executive vice-president and chief operating officer Ricardo Manuel M. Sarmiento “to petition the rehabilitation court to declare that the rehabilitation of the corporation has been successfully completed, to allow the corporation to exit from the rehabilitation.”
“Vitarich is now ready to be competitive again and thereby compete in the market without the protective mantle of a stay order,” it added.
The firm, once the leader in the poultry industry, has been under corporate rehabilitation since May 2007 due to tight liquidity problems resulting from the Asian currency crisis and the avian flu outbreak in 2003.
At the height of the financial crisis, Vitarich’s debts stood at P3.23 billion. Last September, the company’s board approved a P2.376-billion debt-to-equity conversion to pare down its liabilities.
After the debt-to-equity swap, sole creditor Kormasinc Inc. of the Sereno family will control 80 percent of Vitarich.
Vitarich said it sold a property in Marilao, Bulacan to low-cost housing developer 8990 Housing Development Corp.
The disposal of non-core assets forms part of efforts to raise operating capital and pay off remaining debts.
The 65-year-old agribusiness firm said the third generation of the Sarmiento family will continue serving the needs of Filipino farmers. To date, Vitarich’s various production plants have a combined capacity of 15 million kilograms (kg) per month but utilization rate is just six million kg.
Incorporated in 1962 by the Sarmiento family, Vitarich is engaged in the production and distribution of various poultry products such as live and dressed chicken, day-old chicks and animal and aqua feeds, among others. Vitarich’s day-old chicks are supplied to its contract growers and sold to commercial broiler producers.
In the first quarter this year, Vitarich’s net loss hit P40.77 million, deeper than the P16.41-million net loss in the same period last year on the back of lower operating revenue.