Just found an old news (23 Sept 1999) on Kaset Thai Identity Sugar from Bankrupt.com. Very surprised
but we know that, "There is no success without failure".
http://bankrupt.com/TCRAP_Public/990924.MBX
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T H A I L A N D
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KASET THAI SUGAR CO.: Creditors reject rehab plan
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The majority of Kaset Thai Sugar's creditors, led by sugar-
cane planters, yesterday voted down the company's
rehabilitation plan designed by bank creditors and their
adviser.
As a result, the Justice Ministry's Legal Execution
Department -- which is responsible for the sugar-mill case
-- will have to seek a decision from the Bankruptcy Court
either to announce bankruptcy status for the firm and seize
its assets for distribution by the creditors, or allow the
company to resume its normal operations and bring back the
old management team.
If the court rules out the bankruptcy option, Thai Identity
Sugar Group managing director Praphan Siriviriyakul said
that its subsidiary would pursue out-of-court debt-
restructuring negotiations with the creditors.
Last week, the restructuring plan for Thai Identity Sugar
Co was rejected by the majority of its creditors, becoming
the first such case since the recent establishment of the
Bankruptcy Court. Thai Identity Sugar Co, Kaset Thai Sugar,
and Ruam Phol Industry Nakornsawan Co operate the three
sugar mills under the Thai Identity Sugar group, one of
Thailand's largest sugar producers and exporters.
According to Praphan, the Ruam Phol rehabilitation proposal
is likely to meet the same fate today when creditors are
scheduled to consider the approval of the mill's
restructuring plan. Thai Identity Sugar Group owes
combined debts of Bt14 billion to creditors, which include
sugar-cane farmers, and trade and bank creditors. The group
hit the headlines earlier in the year when Michael Wansley,
a top insolvency expert with Deloitte Touche Tohmatsu who
was assisting with the restructuring plan for the sugar
group, was gunned down by a motorcycle hitman. Three
executives of the group have been charged with murdering
the Australian auditor.
A source close to the creditor banks said they had failed
to get approval of their proposed debt-restructuring plan
from the majority of the creditors, because the cane
planters are opposed to it. Although the farmers owe a
smaller amount of debt than the banks, they have the
advantage since the current law counts debtors' decisions
on the basis of the number of debtors rather than the
amount of debt.
The plan for Kaset Thai Sugar Co was rejected by 2,910
small creditors, whose combined loans to the company amount
to 1.12 billion baht, while 63 major creditors with
combined loans of 6.27 billion baht approved it. This
case, as well as the cases of the two other mills, was
filed under the old bankruptcy law. Under the old law, a
business rehabilitation plan or a debt restructuring plan
is required to be approved by at least 50% of all creditors
attending a meeting and their combined loans must be
equivalent to at least 75% of the total loans involved.
In this case, although the combined loans of the major
creditors were equivalent to some 83% of the company's
total 7.49-billion-baht loan, the number of major creditors
was too small when compared with the group of small
creditors.
"The underlying reason is that the cane planters, while
being creditors of the Thai Identity Sugar Group, are also
debtors of the sugar mills. In fact the farmers are debtors
rather than creditors of the mills, thus they fear the
rehabilitation plan submitted by the banks, which includes
a measure to chase the debts for the company," explained
the source.
Thousands of sugar-cane planters are defined as creditors
of the sugar group in addition to about 10 bank creditors,
and 20 trade creditors. Praphan said the Legal Execution
Department was expected to submit the Thai Identity cases
to the Bankruptcy Court next week, and the court is likely
to take another two months to start the process. He added
that the group was tipped to succeed in bringing in new
equity partners to assist the restructuring of the three
companies. Taiwan Sugar and Japan's Sumitomo Corp are among
the potential partners for Thai Identity.
Observers said the failure of Thai Identity would be unique
since the debt restructurings of other sugar mills have
already been concluded out of court. (The Nation, Bangkok
Post 23-Sep-1999)
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