San Miguel Brewery to delist

MANILA, Philippines – The country’s biggest brewer is delisting from the Philippine Stock Exchange.

San Miguel Brewery Inc., the drinks unit of the country’s biggest business group, index-heavy San Miguel Corp., and Japanese brewer Kirin Holdings Co. Ltd, disclosed to the PSE on Monday, February 18, that its board approved the plan in a Februay 15 meeting.

This comes after the company’s public ownership remained below the minimum 10% required by the exchange as part of capital market reforms.

San Miguel Brewery said they will undertake a tender offer to the public who owns 0.61% of the company. Buy back of the 94,239,810 shares the public owns will be from March 4 to April 3.

Months before the December 31 deadline of the PSE for companies like San Miguel units to meet the minimum public float requirement, San Miguel and Kirin were working out an arrangement and stay listed. One of the plans involved issuing additional shares that would result in the dilution of shares.

(VIEW: The public float rule and fate of San Miguel units, Kirin)

Trading of the shares of erring firms were suspended since January 2, face delisting, and are slapped with additional taxes for share deals outside the exchange. 

San Miguel Brewery’s shares were last traded at P29.30 on December 28, 2012, the last trading day before the deadline.

On February 6, another San Miguel subsidiary, San Miguel Properties Inc., announced it would also delist. Its public float was only 0.06%.

Being listed in the stock exchange translates to better access to financing, less cost on equity transactions, and an access to the public’s assessment of the company’s worth.

Food and drinks used to be San Miguel’s core business until it decided in 2007 to diversify into other businesses, including power, infrastructure, utilities, telecommunications, media, among others.

122-yr-old brand

This diversification led to the spin off of the domestic beer business from the parent firm into San Miguel Brewery Inc, which was incorporated on July 26, 2007. San Miguel Brewery listed in the stock exchange on May 12, 2008.

The brewery unit is primarily engaged in the manufacture and sale of fermented and malt-based beverages, particularly beer of all kinds and classes. SMB’s beer brands include, among others, San Miguel Pale Pilsen, Red Horse, San Mig Light and Gold Eagle.

San Miguel Pale Pilsen, the brewer’s flagship brand, has a history of over 122 years.

In 2009, San Miguel and Kirin acquired a 48.39% stake in the brewer, of which 43.249% was acquired from San Miguel and the remaining 5.14% via the succeeding mandatory tender offer.

San Miguel retained majority ownership of San Miguel Brewery with a 51% stake.

This was how San Miguel Brewery’s stock performed during its short stint at the Philippine Stock Exchange.

 – Rappler.com