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Friday, March 29, 2024

Pure Foods sells shares, raises P15b

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San Miguel Pure Foods Co. Inc., a unit of conglomerate San Miguel Corp., has successfully raised P15 billion from the sale of preferred shares amid strong demand from institutional and retail investors, the company’s underwriters said Monday.

SB Capital and Investments Corp. president Ricky Galang said the entire P15 billion worth of shares, including P10 billion in primary offering and P5 billion to cover oversubscription, had been sold ahead of the March 5 deadline.

“The offering was well oversubscribed. The entire P15 billion was sold,” Galang said in a mobile message. The offering period started Feb. 16

The preferred shares, which carry a dividend rate of 5.6569 percent a year, will be listed with the Philippine Stock Exchange on March 12.

San Miguel Pure Foods plans to use the net proceeds from the offering to refinance

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outstanding preferred shares worth the same amount.

Other underwriters of the preferred shares offering were BPI Capital Corp., China Banking Corp., RCBC Capital Corp. and Standard Chartered Bank

San Miguel Purefoods is currently on expansion mode after recently announcing plans to venture into the biscuits and snack foods businesses with the acquisition of a local biscuits maker La Pacita.

The company in January said it was buying out joint venture partner Hormel Netherlands B.V. to become the full owner of a Vietnamese food processing company.

San Miguel Pure Foods over the next two to three years plans to spend P8 billion to P10 billion in capital expenditures to expand its domestic and overseas businesses.

San Miguel Pure Foods is in talks with potential partners for acquisition plans and has started identifying target foreign companies.

San Miguel Purefoods on the domestic front plans to build 10 new facilities this year to expand the production capacity of flour mills, nuggets, hotdogs, feed mills and poultry businesses.

Net income of San Miguel Pure Foods in the first nine months of 2014 stood at P2.7 billion, flat year-on-year, due to adverse impact of port congestion.

Consolidated revenues, however, inched up four percent to P74.4 billion from a year ago, driven primarily by its agro, milling and dairy businesses.

Operating income rose 18 percent to P4.3 billion, as favorable selling prices, lower wheat costs and improved availability of key raw materials resulted in better margins to the company, while tempering the adverse impact of the Manila port congestion and typhoon Glenda on operations.

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