Pryce stockholders okay rehabilitation program

Publicly-listed Pryce Corp. has filed for suspension of debt payments and rehabilitation after securing the approval of over 94 percent of its shareholders.

In a statement, Pryce said it was left with no choice but to seek debt relief from the courts in order to protect and preserve itself while a viable and acceptable rehabilitation plan is being drawn out.

Among the measures being considered by management to reduce the company’s debt include the dacion-en-pago of its properties, the restructuring of its obligations, the conversion of debt into equity, the increase or decrease of its authorized capital stock, and the issuance of bonded indebtedness.

Pryce said its assets, which are mortgaged to creditors, face the imminent danger of being foreclosed or attached to the prejudice of the other creditors of the corporation, its shareholders and the company itself.

Trading of Pryce shares has been suspended indefinitely to comply with the listing rules of the Philippine Stock Exchange (PSE).

Under the PSE's amended listing rules, an announcement by a listed company of an intent to file or the actual filing of proceedings for suspension of payments shall merit an immediate suspension of trading of security of the listed firm.

Pryce operates primarily in Mindanao, particularly in the cities of Cagayan de Oro, Davao and Iligan. The Company’s real estate undertakings include the development of memorial parks, residential and commercial properties and hotel operations.

In the past, property development was the company’s principal business. However, in 1997, liquefied petroleum gas (LPG) and industrial gases became its dominant business, compelling the company to change its name and primary purpose from that of a property company to that of a manufacturing concern.

A subsidiary, Pryce Gases Inc. (PGI), is itself under rehabilitation. Based on the recovery program earlier submitted to the Makati Regional Trial Court, Pryce has offered its real estate assets as partial payment of PGI’s obligations to creditors.

The rehabilitation plan was filed by PGI creditors – International Finance Corp., the private sector financing arm of the World Bank and the Netherlands Development Finance Co.

As of April 30, 2002, PGI owed banks and financial creditors a total of P2.671 billion or approximately $53.5 million, of which about 44 percent was due to IFC and NDFC combined.

PGI has been in default on its interest payments to IFC and NDFC since December 2000 and on its principal payments since December 2001. The company is engaged in the distribution of LPG and industrial gases primarily in the Visayas and Mindanao regions.