San Miguel Corp plans to raise P80B, acquire Peroni and Grolsch

MANILA, Philippines —The country’s most diversified conglomerate San Miguel Corporation plans to raise as much as P80 billion ($1.67 billion) in fresh capital through issuance of preferred shares.

San Miguel told the Philippine Stock Exchange that its board of directors approved the shelf registration of up to P80 billion ($1.67 billion) worth of preferred shares. This involves 1.066 billion shares at an offer price of P75 ($1.57) per share.

The preferred shares will be issued over a period of 3 years.

Although it did not clearly say where it will spend the fresh capital, San Miguel said it will file the appropriate registration statement and prospectus with the Securities and Exchange Commission.

“For these purposes, the board has authorized the engagement of the services of underwriters, advisors, legal counsel, stock and transfer agent, receiving agent and other agents as may be necessary, proper or desirable to effect the offering,” San Miguel Corporate information officer Ferdinand Constantino said.

In 2015, San Miguel also raised P33.5 billion ($700.30 million) from issuance of preferred shares. 

Proceeds from that offering were used to partially fund the early redemption of the company’s outstanding debt amounting to P54.08 billion ($1.13 billion).

San Miguel is one of the largest conglomerates in the Philippines by revenues and total assets, with sales of about 6.2% of the Philippine gross domestic product in 2014.

The conglomerate is broadly exposed to the Philippine economy through its diverse range of businesses spanning the beverage, food, packaging, fuel and oil, energy, infrastructure, telecommunication, property, and banking industries. 

San Miguel said it is well-positioned for significant future growth as its established businesses in beverage, food and packaging continue to provide stable cash flow, while its new businesses have enabled the company to expand its ability to generate higher returns.

Acquire Peroni and Grolsch

Early this week, San Miguel President and COO Ramon Ang said the company is interested in acquiring European beer brands Peroni and Grolsch owned by SABMiller Plc of the United Kingdom.

Reuters reported on Friday, January 15, that Ang said his brewery is still interested in SABMiller’s beer brands through a partnership with Japan’s Kirin Holdings Company Limited. Kirin owns nearly 50% of San Miguel Brewery.

Ang said San Miguel would join the bidding for the well-known beer brands, which were being sold to obtain regulatory approval for the merger of Anheuser-Busch InBev NV and SABMiller Plc. — Rappler.com

$1=P47.83