MANILA, Philippines — San Miguel Food and Beverage Inc. (SMFB) expects to raise as much as $3.6 billion from a follow-on offering in the latter part of the year, its president Ramon Ang said yesterday.
SMC senior vice president, chief financial officer and treasurer Ferdinand Constantino said they hope to do it in October or November after securing all the necessary approvals.
Ang said the minimum value of the new consumer giant after consolidation is $12 billion.
“So if we sell 20 percent, it is $2.4 (billion), if we sell 30 percent, it’s $3.6 (billion),” Ang said when asked about the size of the offering.
Ang is very bullish about the growth prospects of SMFB, which is seen as a rebirth of the old SMC when it was still just a food and beverage business.
“Old businesses are usually forgotten during diversification, but that didn’t happen in our case. We continue to grow and we remain bullish on the sector,” Ang told reporters.
SMC completed the consolidation of its food and beverage businesses under SMFB via the transfer of P336.35 billion worth of shares.
Upon approval of the Securities and Exchange Commission of its increase in capitalization, SMFB will issue 4.24 million in new shares to parent firm SMC at P79.82 per share. These are in exchange for SMC’s 7.86 billion common shares in San Miguel Brewery and 216.97 million shares in Ginebra San Miguel.
SMFB will not only have the existing food businesses of SMC under Purefoods but will also own 51.2 percent of San Miguel Brewery, the country’s top beer producer, and about 76 percent of liquor company Ginebra.
Ang said SMFB’s tender offer would comply with the minimum 15 percent public ownership requirement. He said the company would sell more, depending on the demand.
“We will proceed with the share sale whatever the market conditions are,” he said.
SMFB has tapped UBS, Morgan Stanley, JP Morgan, BDO and BPI as underwriters for the share sale.
Last month, SMFB received the green light from the SEC to rename the company from San Miguel Purefoods Co.
SMFB amended the company’s primary purpose to include engagement in the alcoholic and non-alcoholic beverage businesses.
Raymond Neil Franco, head of research of Abacus Securities, said SMC’s decision to fold in its beer and liquor businesses into Purefoods is like going ‘back to the future as SMC revives its play on food and beverage.