Alliance Global to borrow P31.7B for Whyte & Mackay acquisition

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Alliance Global Group Inc. (AGI), the holding firm of tycoon Andrew Tan, said it will fully acquire “in the coming weeks” Scottish whiskey firm Whyte & Mackay Group Limited for P31.7 billion through its subsidiary Emperador Inc.

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Kingson Sian, AGI president and chief operating officer, told reporters in a briefing that funding for the buyout will come from short- and long-term debt and not through equity sale.

The acquisition, the largest Emperador takeover to date, will enable the Tan-led liquor firm to expand mainly in the Scotch whiskey segment, he said.
The acquisition will allow AGI to develop affordable whiskey products for the Philippine market, priced below P100 per bottle, Sian said.

Sian also said that AGI would ride on the Emperador and Whyte & Mackay brands to expand its whiskey business in the Asia and the Pacific region.

“We’ll introduce local products for the [Philippine] market, and also the Asian market. [Whyte & Mackay is] strong in Europe, but they are not in Asia. So with this [acquisition], we plan to tap the Asian market. Specifically, the Chinese market is interesting,” he said.

Whyte & Mackay products to be offered to the Asian market will include whiskey brands Dalmore for high-end customers, Jura for mid market buyers, and blended Whyte & Mackay for the low-end market.

AGI’s consolidated net profit went up 1.2 percent to P11.37 billion in the first half of 2014 from P11.24 billion last year, as revenues dipped 1.9 percent to P59.6 billion from P60.8 billion on liquor unit Emperador’s slight loss in the first six months.

Subsidiaries’ contributions to AGI’s net income in the first half are as follows: 44 percent from Megaworld; 27 percent, Emperador; 25 percent, Travellers; and 3 percent, Golden Arches Development Corporation (GADC).

Incorporated in 1993 and listed in the stock exchange in 1999, Alliance Global holds Tan’s businesses in property development (Megaworld); food and beverage manufacture and distribution (Emperador); quick-service restaurants (GADC); and integrated tourism development businesses (Travellers).

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