Victorias needs P10b to upgrade sugar mill

Victorias Milling Co. Inc. is looking for a company that could raise between P8 billion and P10 billion to repay debts and finance the modernization of its refinery.

Victorias Milling chairman Omar Mier told reporters following the company’s annual stockholders’ meeting that the company needed an investor in settling P6.2 billion worth of outstanding debt and spending P4 billion for the upgrade of the sugar refinery.

Mier said the company must stay competitive in 2010, when the tariff protection on sugar is reduced to 5 percent.

“Next two years would be tough for the sugar industry because by 2010, tariff rate on sugar will go down and we will be facing competition from cheap imports,” Mier said.

One of the potential investors could be Lucio Tan-owned Tanduay Holdings Inc.

In 2007, Tanduay acquired a 10.6 percent interest in Victorias Milling by purchasing the 170 million shares owned by Miguel J. Ossorio Pension Foundation Inc.

Tan, through Philippine National Bank, also owns another 10 percent of the sugar company.

Mier said the company also planned to sell non-core assets to help reduce debt pending help from an investor.

The company’s operating subsidiaries include Victorias Foods Corp., Canetown Development Corp., Victorias Quality Packaging Corp., Victorias Golf and Country Club Inc. and Victorias Agricultural Land Corp.

The units are engaged in several businesses such as fish canning, real estate, sugar sack manufacturing and packaging, and golf course and restaurant operation.

Victorias Milling is in talks with an adviser to help dispose the assets.

Meanwhile, the company is undertaking steps to have the trading suspension on the company’s shares lifted.–Jennifer Austria, Manila Standard Today