Century Tuna buys sister firm for P4.5B


Tuna and processed meat canner Century Pacific Food Inc. (CPFI) will be acquiring 100 percent of sister firm Century Pacific Agricultural Ventures Inc. (CPAVI), a coconut products maker, as part of a plan to expand into new food markets.

In a disclosure, CPFI said it would be buying CPAVI from parent firm Century Pacific Group, Inc. for P4.5 billion, half to be funded by cash and the rest from the issuance of new shares.

In particular, the P2.25-billion cash portion will come from existing cash and bank loans.
The balance will come from the sale of 128.2 million CPFI primary shares at P17.55 each.

The share price is equivalent to a 4.4-percent premium from the company’s 30-day volume weighted average price of P16.81 per share as of October 26, and 3.85 percent higher than the closing price of P16.90 per share as of the same day.

The company called for a voluntary trading halt on Tuesday following the acquisition’s disclosure.

CPAVI is expected to contribute 7 percent to 8 percent of CPFI’s revenues in 2016. The purchase is expected to be completed before the year ends, subject to approval by the Board of Investments.

“The global trend towards healthy and organic coconut products is growing rapidly in developed economies like the US and Europe. This is an area where Philippine industry has an advantage and can be globally competitive,” CPFI President Christopher Po said in a separate statement.

“We think this new business will be a great addition to Century Pacific Food, Inc’s portfolio and another leg to sustain and drive the company’s future growth,” he added.

Established in August 2012, CPAVI operates an integrated coconut facility producing coconut water, desiccated coconuts and virgin coconut oil, among others.

The coconut water and virgin coconut oil are sold to global brands and. Other products include copra, coco meal and coco shells that are sold in the domestic market.

Po has said that CPFI wanted to grow its sales and profits by “10 percent to 15 percent yearly” over the next two to three years.

In the first half of 2015, CPFI saw a 30 percent increase in net income to P935 million, with revenues growing by 17 percent to P11.308 billion.

The company manufactures household brands such as Century Tuna, 555, Blue Bay, and Fresca for canned tuna products; Argentina, Swift, Shanghai, Wow Ulam and Lucky 7 for canned meat; Angel and Birch Tree for canned milk and dairy mixes; Kaffe de Oro for coffee; and Home Pride for the flavor mixes.

The company has set aside P820 million for capital expenditures this year, of which P450 million will be spent for the ongoing construction of its cold storage facility.

Incorporated in 2013, CPFI is engaged in the production of canned and processed fish, canned meat, dairy and mixes, and also exports tuna under the Po family’s umbrella conglomerate Century Pacific Group, Inc., formerly Century Canning Corp.


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