SAN MIGUEL Food and Beverage, Inc. (SMFBI) looks to conduct a follow-on offering by the second quarter of 2018 in order to meet the minimum public float of 15%.
Diversified conglomerate San Miguel Corp. (SMC) is currently consolidating its food and beverage businesses Ginebra San Miguel, Inc. (GSMI) and San Miguel Brewery, Inc. (SMB) under San Miguel Pure Foods Company, Inc. (SMPF), which is being renamed SMFBI.
After the consolidation, SMFBI will have a public float of 4.3%, way below the current floor of 15% for listed companies.
“The company is targeting 15% which is the minimum requirement. And then we will decide later on if there is an additional follow-on (offering) that is needed,” SMPF President Francisco S. Alejo III said during a special shareholders’ meeting in Mandaluyong City on Thursday.
SMC Chief Finance Officer Ferdinand K. Constantino said they look to attract a combination of foreign, institutional, and domestic investors for the issuance.
Mr. Constantino noted the surviving company can book up to P245 billion in revenues this year, with P120 billion coming from food, P100 billion from beer, and the remaining P25 billion from GSMI.
On the other hand, SMPF secured shareholder approval for various transactions relating to the consolidation of SMC’s businesses during the special stockholders’ meeting. Among these are the changes in SMPF’s corporate name to SMFBI and the change in its primary purpose to include the operations of the liquor and brewery businesses.
Shareholders also approved SMPF’s acquisition of SMB and GSMI from SMC through a share swap transaction, valued at P336.35 billion for a total of 7.86 billion common shares in SMB and 216.97 million common shares in GSMI.
“The company will issue 4,242,549,130 common shares to SMC valued at P79.28 per share, totaling P336, 349,294,992.60,” SMPF said in a presentation.
The shares resulting from the share swap transaction will also be listed at the PSE.
The company has also been given the go-signal to conduct a tender offer for SMB and GSMI shares held by its minority shareholders. This move, however, will only be done if the Securities and Exchange Commission requires the company to do so.
Mr. Constantino said the consolidation of SMC’s traditional businesses will provide value proposition to investors, as it can be used as a gauge for the country’s food and beverage sector.
“It will be attractive to investors, because there is no other food and beverage company in the Philippines. It will be a good proxy for the Philippine environment… Malaki value nun (The value is significant), because there’s a big demand for that,” Mr. Constantino told reporters in a briefing after the special shareholders’ meeting.
Shares in SMPF dropped P4 or 0.74% to P537 each at the stock exchange on Thursday, while shares in SMC were up by a peso or 0.77% to P131.50 apiece. — Arra B. Francia
