March 10, 2011
Court approves Vitarich to dispose more than US$4 million of assets
Philippine animal feeds producer Vitarich Corporation was granted approval by a regional trial court to sell some of its assets worth around PHP200 million (US$4.61 million).
In a disclosure, the company said the Regional Trial Court of Bulacan, Branch 7 issued an order approving the sale of the company's non-core assets located in the Visayas and Mindanao to Kormasinc for PHP184 million (US$4.24 million) plus by way of reduction of corporate debt.
The sale is aligned with its corporate rehabilitation programme, the company added.
The company's board of directors approved in July 2009 the disposal of several non-core property, plant and equipment and investment property worth PHP975 million (US$22.49 million).
The property, plant and equipment and investment property, which are in Visayas and Mindanao, are included in the assets used as collateral for the company's restructured long-term debt.
As of end-June last year, the company had PHP3.42 billion (US$78.88 million) in liabilities, of which PHP2.56 billion (US$59.05 million) were non-current liabilities, Vitarich said in its financial report.
Vitarich, which used to be a big player in the industry, has been under corporate rehabilitation since 2006 because of difficulties in paying off PHP3.23 billion (US$74.52 million) in loans to various creditors.
The company had blamed the Asian financial crisis of 1998 and the avian flu outbreak in 2003 as the reasons behind its financial woes.
In January last year, a group of companies led by the Sarmiento family turned over a part of its stake in the poultry and feeds firm to Metropolitan Bank & Trust Co. to erase debts.
Bulacan's provincial sheriff auctioned and sold 97 million Vitarich shares to Metrobank, one of the company's creditors. The shares were used as collateral for the company's loans.
Established in 1950 by brothers Feliciano, Lorenzo and Pablo Sarmiento, Vitarich is engaged in the manufacture and distribution of various poultry products such as live and dressed chicken, day-old chicks, and animal and aqua feeds.
Shares in Vitarich, whose profits declined to PHP913,000 (US$21,064.98) in the first half last year from PHP920,000 (US$21,277.30), closed on February 18 at PHP0.44 (US$0.01) apiece.
