San Miguel Corp. (SMC) is consolidating its food and beverage businesses under unit San Miguel Pure Foods Co. via a share swap deal worth over P336 billion.
In a disclosure, the Ramon Ang-led conglomerate said it would be subscribing to 4.24 billion in new Pure Foods shares, to be paid for via the transfer of 7.86 billion shares in San Miguel Brewery, Inc. and 216.97 million shares in Ginebra San Miguel, Inc.
The transaction was valued at P336.35 billion by ING Bank.
In a separate disclosure, Pure Foods said its corporate name would be changed to San Miguel Food and Beverage, Inc.
The company’s primary purpose will also be expanded to include its engagement in the alcoholic and non-alcoholic beverage business.
Pure Foods’ share price rose to the 50 percent daily limit, closing the day up P154 per to P462, while San Miguel rose by P5.50 or 5.43 percent to P108.60. Ginebra San Miguel nearly hit the trading limit, gaining 49.94 percent or P7.76 to P23.30.
San Miguel said it would, among others, also seek a tax exemption from the Bureau of Internal Revenue for the transaction, another exemption from the required Philippine Competition Commission approval, and all other clearances from regulators such as the Philippine Stock Exchange (PSE) and the Securities and Exchange Commission (SEC) for the listing of the new Pure Foods shares.
In addition to the name change and expansion of its primary purpose, Pure Foods said its articles of incorporation would also be changed to reflect a reduction in the par value of its common shares to P1 from P10.
The issuance of 9.54 billion in new shares will boost its authorized capital stock to 12 billion, divided into 11.6 billion in common shares and 40 million in preferred shares worth P10 per.
Of the new shares, 4.24 billion or around 44 percent will comprise San Miguel’s subscription.
Pure Foods reiterated the exemptions sought by San Miguel and added that it would also be asking the PSE and SEC to defer its compliance with the minimum public ownership requirement.
A tender offer for San Miguel Brewery and Ginebra San Miguel common shares held by minority shareholders was also authorized by the Pure Foods board, if required by relevant laws and regulations.