In a 20-page decision dated July 31 and penned by Associate Justice Angelita A. Gagucatan, the CA’s 10th division said it “cannot give credence to charges based on mere suspicion� by Barclays Bank Plc. and Deutsche Bank AG London that Vitarich could not implement the approved rehabilitation plan.

“It was merely speculative on the part of petitioner-banks to put forth the argument that Vitarich can no longer meet its obligations,� the CA said.

Barclays and Deutsche, two of the many creditors of Vitarich, asked the appeals court to review a lower court’s February 2011 decision denying their petition seeking termination of the listed animal feeds producer’s rehabilitation plan.

The two banks claimed that Vitarich had “failed to achieve the desired targets or goals… [and] itself had admitted that it could not implement the Approved Rehabilitation Plan in accordance with its terms, conditions, restrictions or assumptions.�

Vitarich in July 2010 had asked a lower court to modify an approved rehabilitation plan, as increases in fuel and wheat prices, stringent payment of terms due to 2008 financial crisis, and typhoons Ondoy and Pepeng in 2009 made it “extremely difficult� to pay commitments.

Among the listed firm’s request was to use P300-million insurance “to restore destroyed production service facilities and improve its laboratory�; allow infusion of money by a “White Knight�; and eventual conversion of its Marilao Plant into a mixed use residential and commercial development.

Vitarich’s petition, however, had prompted Barclays and Deutsche to ask a lower court to terminate the rehabilitation plan, but was denied.

The CA sided with the lower court, who had ruled that the two banks petition was “premature.�

“Based on the facts… it appears that there was reason to believe that the payment [of] obligations can be made,� the CA’s decision read.

Citing Vitarich’s manifestation on Jan. 20 of last year, the CA noted that the animal feeds producer was “actively talking to certain businessmen who would become ‘White Knight’ investors of Vitarich.�

Vitarich, which used to be a big player in the agricultural industry, filed for corporate rehabilitation in 2006 because of difficulties paying off P3.13 billion in loans. It had been under a court-prescribed rehabilitation program since 2007. — Antonio Siegfrid O. Alegado