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Thursday, March 28, 2024

EastWest loses Victorias bid

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The Court of Appeals turned down the petition of EastWest Banking Corp. of the Gotianun Group to convert its debt notes in Victorias Milling Co. into equity.

Victorias Milling said in a disclosure to the stock exchange the appellate court upheld the decision of the Securities and Exchange Commission denying the appeal of EastWest Bank to exercise its option on the conversion of the debt note into shares.

The Court of Appeals ruled that Victorias Milling paid or redeemed the convertible note issued in favor of EastWest Bank following the terms and conditions of the alternative rehabilitation plan and the debt restructuring agreement signed with creditors on April 29, 2002.

SEC’s hearing panel in March last year sided with EastWest Bank and directed the sugar company to convert 13 percent of the outstanding unconverted notes held by the bank into common shares.

The sugar milling company, however, filed an appeal with the SEC en banc, resulting in the reversal of the decision.

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Victorias Milling has been reducing its debts as part of the rehabilitation plan.

EastWest Bank is the only major creditor-bank that refused to accept Victoria Milling’s proposal to prepay its debt.

Victorias Milling is primarily engaged in integrated raw and refined sugar manufacturing with plant facilities in Victorias City, Negros Occidental province.

The company, through its operating subsidiaries, is also engaged in several businesses, such as fish canning, real estate, sugar sacks manufacturing and packaging, and golf course and restaurant operations.

It is primarily owned by LT Group Inc. and Hong Kong-based First Pacific Co. Ltd.

Aside from banking and real estate, the Gotianun Group is engaged in the sugar milling business under unit Pacific Sugar Holdings Corp.

Pacific Sugar owns three Mindanao-based sugar companies, namely Davao Sugar Central Co., Cotabato Sugar Central Co. and High Yield Sugar Farms Corp.

Victorias Milling earlier allotted P500 million to implement a share buyback program in a bid to improve shareholders’ value.

First Pacific initially acquired a 5.78-percent interest in Victorias Milling. The Hong Kong-based conglomerate as of end-December 2014 held 16.8 percent of Victorias Milling, entitling it to one board seat.

First Pacific’s interest is seen to complement the group’s regional food business through Indofood, one of the biggest food companies in Indonesia.or carry over volume of domestic sugar during the end of season and for the start of the next crop year for stable supply and prices,” Martin said.

She said the adjustment in sugar allocation was due to the expected drop in production caused by the intense heat that had affected most of the sugar-producing provinces.

“Expected sugar production for the current crop year will be 2.31 million metric tons from the original target of 2.5 million metric tons at the start of the crop year. We have to make sure that we have enough buffer stock for the domestic market which will be good for two months of consumption,” Martin said.

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