To subscribe to Del Monte’s rights offer
Campos family-led NutriAsia Pacific Ltd. has signed a $100-million loan facility with the Bank of the Philippine Islands (BPI) to finance NutriAsia’s subscription to Del Monte Pacific Ltd.’s (DMPL) stock rights offer.
NutriAsia informed the Philippine Stock Exchange it has entered a share charge agreement with BPI to get the loan. NutriAsia will put up its controlling stakeholdings in DMPL as a collateral to the loan. The collateral will cover for not less than 200 percent of the loan amount and dividends accruing from the shares equivalent to an agreed percentage of the loan amount.
Under the share charge agreement, the loan will be constituted in favor of Hongkong and Shanghai Banking Corp. Ltd. as security agent over NutriAsia’s shares in DMPL.
NutriAsia is required to provide additional security to maintain the 200-percent collateral value.
“The loan will be drawn down when [NutriAsia] submits the relevant subscription application form under the rights issue and the share charge will only be created then,” DMPL said.
NutriAsia expects the share charge agreement will cover 849.99 million of its shares in DMPL, which amounts to 65.28 percent of DMPL’s issued share capital before the rights issue and about 43.72 percent of its enlarged share capital after the rights issue.
Fruit canner DMPL is looking to raise $154.4-million fresh funds from the stock rights
issue to be launched both in the Philippines and Singapore. The $149.9 million proceeds after regulatory and issuance fees will partly finance the company’s loan from BPI used to acquire its $1.68-billion US subsidiary Del Monte Foods Inc. on February 18 last year.
DMPL has booked $21.7-million net loss in the first semester of its 2014-2015 fiscal year, a decline from its $12.96-million net income a year ago on incurred acquisition expenses from the DMFI takeover.
Despite net losses, the fruit canner saw a surge in its April to October 2014 revenues to $993.63 million from $255.66 million a year ago, with over $700 million contributed by the newly-acquired DMFI.
The firm’s fiscal year was adjusted to April to May from the previous January to December to align with the financial year of its US subsidiary DMFI.
DMPL owns the leading brand Del Monte across food and beverage categories in the Philippines, as well as in India via joint venture firm FieldFresh Foods with one of India’s largest conglomerates Bharti Enterprises.