Lucio Tan group acquires more shares in VMC
MANILA, Philippines — Beer and tobacco tycoon Lucio Tan has acquired P660 million ($13.85 million) worth of shares in sugar milling and refining company Victorias Milling Company Incorporated (VMC).
These shares were sold by Hong Kong-based First Pacific Company Limited.
First Pacific said in a statement it agreed to dispose of its 14.8% shareholding in VMC in two transactions totaling P2.16 billion ($45.32 million).
First Pacific said VMC acquired 300 million shares while the second buyer, the LT Group, through its subsidiary, has acquired a total of about 131.9 million shares.
Both transactions value the Bacolod-based sugar milling firm at P5 ($0.105) per share.
The deal will boost LT Group’s stake in VMC by 4.5% to 28.1%.
Prior to this deal, LT Group, through its liquor unit Tanduay Holdings Incorporated, owned 23.6% interest in the sugar milling firm
On Tuesday, February 16, VMC reported that its board approved the acquisition of 365 million shares owned by companies affiliated to First Pacific.
An informed source said VMC decided to buy only 300 million shares so its cashflow will not be severely reduced.
Despite the divestment in VMC, First Pacific said it remains remains committed to the Philippine sugar industry through its investment in Roxas Holdings Incorporated (RHI), another leading sugar and ethanol producer also listed on the Philippine Stock Exchange.
First Pacific Managing Director and CEO Manuel Pangilinan said the company will now focus its management and financial resources within the industry on RHI.
"We are focusing our investment in the Philippine sugar industry on RHI and preparing for its rights issue announced earlier," Pangilinan said.
Last week, RHI announced that its board had approved in principal a rights offering of common shares to all shareholders.
The offer size, entitlement ratio and offer price have not been set yet.
RHI, which is 51% owned by First Pacific, registered a net loss of P125 million ($2.62 million) in the first quarter of fiscal year ended December 2015, a turnaround from P9 million ($188,817.10) net income recorded in the same period last year amid operational challenges affecting its two manufacturing plants. — Rappler.com