Debt-ridden Thai food packaging company Peace Canning, has had a debt revamp plan approved by creditors, countering reports that its Pigeon brand, Thailand's best-known food trademark, would be put up for auction.
''The largest group of creditors voted to accept the plan on Wednesday at a meeting held at the Legal Execution Department,'' said Vorasit Pokachaiyapat, a director of Finansa Ltd, the company's financial adviser.
He said the plan was expected to be reviewed by the Central Bankruptcy Court next month.
Once the court ruled in favour of the plan, the company would be cleared from bankruptcy status and could resume its normal business operation as well as continue using the Pigeon brand.
Under the plan, debts totalling Baht 3 billion (€7.5 million) to 20 financial and trade creditors, including Baht 2 billion in principal, will be settled by unsecured debts over eight years; lodging collateral against the secured debt; and creditors' accepting a partial loss. As a result, the principal owed would be reduced to Baht 800 million.
The company pioneered the canned food industry in Thailand under the famous Pigeon brand, particularly pickled vegetables. The company also produces canned fruit and fruit juice under the same brand.
The company was declared bankrupt and placed in receivership by the Legal Execution Department after accumulating heavy debts during the recession that began in 1997.
An executive of the company, who declined to be identified, said he was surprised by talk that the Pigeon brand was going to be put up for auction while debt restructuring was under way.
He suspected that some disgruntled creditors might have spread the word to derail the talks.