January 27, 2020 at 08:20 pm
Darwin G. Amojelar
Del Monte Pacific Ltd. on Monday said it signed a deal with a Singaporean company to sell a 13-percent stake in Del Monte Philippines Inc. for $130 million.
Del Monte and indirectly wholly-owned subsidiaries Central American Resources Inc. and DMPI entered into an agreement with SEA Diner Holdings Pte Ltd. for the proposed sale of 363.65 million ordinary shares of DMPI.
SEA Diner focuses on investing in leading companies in the consumer sector in China and Southeast Asia.
The company and its affiliates have invested over $1 billion in ASEAN and Chinese consumer businesses to date, including consumer product companies and technology companies.
The food category has been a key focus for the SEA Diner and its affiliates, with a particular emphasis on food products that have a large addressable market in China.
The sale of 13 percent shares to SEA Diner came after DMPI deferred its public offering in 2018 due to adverse market conditions
DMPI said it would use the proceeds from the sale of the shares to pay debts and fund expansion plans.
Del Monte Group’s net debt amounted to $1.4 billion as of fiscal year 2018, significantly lower than the net debt of $1.7 billion in 2017.
The company added it would use the funds raised from the proposed sale for the group’s capital restructuring plans, given that DMPI was unable to conduct the proposed public offering due to volatile market conditions that showed no signs of improving.
DMPI said it was teaming up with SEA Diners to help the company expand its fresh fruit sales in China.
“The investor has close relationships with many of the leading online and offline food retailers in China,” DMPI said, adding SEA Diners understood that the company’s s only e-commerce sales in China was through a major player and it could help DMPI penetrate many more of the online grocery players in China.
SEA Diners can also help DMPI’s expand its frozen fruit sales in China and in Japan.