MVP in acquisition mode

Our friend First Pacific CEO Manny Pangilinan has been very busy travelling lately, looking out for business opportunities outside the country. MVP’s acquisition mode was evident when First Pacific submitted an all-cash offer of $1.179 billion to acquire the entire issued share capital of Goldman Fielder (GF), Australasia’s biggest publicly listed food manufacturing company.

First Pacific joined forces with Singapore-based agribusiness giant Wilmar International via a 50-50 joint venture in offering the non-binding proposal of A$0.65 per share which was actually 18 percent higher than the closing price of A$0.55 per share last Thursday for Goodman Fielder. Wilmar, which holds 10.2 percent in Goldman Fielder, is a company under the Kuok Group of Malaysia’s richest man Robert Kuok.

GF (whose main operations are located in Australia and New Zealand) has been going through difficulties in the last three years – described by insiders as a basket case – and no amount of cost cutting by CEO Chris Delaney has been able to lift the sagging profit margins of Goodman Fielder, whose popular brands include Meadowlea, Meadow Fresh, Irvine, Pampas, Olive Grove, Helga and White Wings.  It has been forced to lower the sale prices of banner products, and its plan to dismiss 300 employees by yearend to save $25 million has been accelerated, with the job cuts to be made in the next three months due to continuing weak financial performance.

GF had rejected the acquisition offer, but observers who noted the slight increase in the share prices after GF’s rejection say it’s an indication that the market thinks no rival offer is forthcoming. Insiders also say Wilmar and First Pacific will continue to seek engagement with the Goodman Fielder board, and are looking at bringing forward a binding proposal to shareholders, many of whom are said to be growing impatient given the seeming difficulty of Delaney in preventing the trajectory from “going further down south.”

If or when First Pacific’s acquisition plan eventually succeeds, this will give the Hong Kong-based company an opportunity to create a leading Asia Pacific agriculture and consumer staples company. This could mean even more traveling for MVP – which is probably the reason why we have been missing him on several state lunches and dinners, including the one last night for the US President.

No low key for Obama­

Traffic flow was pretty much the same despite the arrival of US President Barack Obama for a 24-hour visit to Manila. According to US Ambassador Philip Goldberg, the American president wanted the least amount of disturbance and distraction for his visit and that includes traffic disruptions – which is quite in contrast with the October 2003 eight-hour visit of George W. Bush, where a lot of roads were closed and traffic in many places were rerouted to give the US presidential convoy uninterrupted passage to Batasan in Quezon City.

Apparently, this president does not want to be too high key – but there’s no way an American president can ever travel low key given the massive preparations and especially after arriving on board Air Force One. According to AFP spokesperson Lt. Col. Ramon Zagala, the Presidential Security Group took the lead in making security arrangements, but it’s very clear US Secret Service and other security personnel are playing a dominant role in securing the American president. As our insider noted, the Americans have imposed a number of restrictions even inside Villamor Air Base. Aside from NAIA, the Civil Aviation Authority of the Philippines (CAAP) has also issued a no-fly zone order for airports in Sangley, Cavite as well as Lipa in Batangas and San Ildefonso in Bulacan. Pasig River was also declared as a “no-sail zone” obviously because of the proximity of Malacañang Palace where Obama proceeded after his arrival.

We’re told Obama will be using Marine One (shown in photo taking off from the White House South Lawn)  – the call sign for the Marine Corps chopper to transport the US president during most of his stay. The Marine One choppers currently in service are the Sikorsky-manufactured VH-3D Sea King or the VH-60N Night Hawk, although the US Navy is finalizing a contract for the presidential helicopter replacement program with Lockheed Martin and Sikorsky teaming up for a bid to produce the state-of-the-art presidential S-92 chopper.

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