SM Investments Corp. (SMIC), the investment holding firm of retail tycoon Henry Sy, has sold its entire 11-percent stake in food and beverage giant San Miguel Corp. for P27.15 billion or P80 per share.
In a disclosure to the Philippine Stock Exchange, SMIC said its board approved yesterday the sale of about 339.35 million San Miguel “A” shares to SMC Retirement Fund, controlled by the food and drink firm’s own employees.
The SM Group’s stake represents one seat on San Miguel’s board of directors.
SMIC sold the shares at a premium of P20.50 per share based on yesterday’s closing price of P59.50 for San Miguel “A” shares.
SMIC executive vice president and chief finance officer Jose T. Sio said the move was intended to allow the SM Group to focus on its core businesses and to fund the massive investments required for its real estate development projects.
“We took an excellent opportunity to cash in on one of our investments at a good price. We still believe San Miguel is a company worth investing given its strong brand franchise in beer and its dominant position in the food and beverage business. However, SM would like to focus on its four core businesses at this time, namely retail merchandising, mall operations, banking and property development,” he said.
SMIC said proceeds from the share sale will be used for general corporate purposes, capital expenditures and other investments.
“SMIC is aggressively pursuing its property development project in areas such as residential development under SM Development Corp., commercial development mainly at the Mall of Asia complex, tourism development in Hamilo Coast, and hotel investments in key cities across the country. All these projects will require a considerable amount of capital expenditure for the company moving forward,” Sio said.
SMC Retirement Fund has been acquiring additional shares in Southeast Asia’s food and beverage conglomerate.
It was earlier reported to have also purchased the 199.35 million shares held by state pension fund Government Service Insurance System in San Miguel last April.
The GSIS raised around P14 billion in proceeds from the sale of the shares.
With this purchase, SMC Retirement Fund’s stake in San Miguel would increase to around 27 percent, analysts said.