November 8, 2017 / 9:28 AM / a year ago

UPDATE 1-Philippines' San Miguel unit to raise $3 bln via share sale

* Food and beverage unit to sell up to 30 pct of shares

* To follow planned consolidation of food, beer assets

* Share sale will increase public float - fund manager (Adds fund manager’s comments, share prices, background)

By Neil Jerome Morales

MANILA, Nov 8 (Reuters) - The food and beverage unit of the Philippines’ San Miguel Corp plans to raise around $3 billion through a share sale early next year as the diversified conglomerate consolidates its core business.

One of the country’s biggest companies, San Miguel has pursued an aggressive expansion plan since 2008, venturing into infrastructure, mining, petroleum and power generation to boost revenues from maturing beer and food units.

The fund-raising comes after the parent company on Monday moved to combine through a share swap its food and beverage assets valued at 336 billion pesos ($6.6 bln).

Its food subsidiary, San Miguel Pure Foods Co Inc, will acquire San Miguel’s majority stakes in both gin and spirits maker Ginebra San Miguel Inc and beer manufacturer San Miguel Brewery Inc.

Pure Foods will then be renamed San Miguel Food and Beverage Inc and will issue more shares in February, San Miguel President Ramon Ang told Reuters in a text message. The shares to be offered will comprise up to 30 percent of San Miguel Food and Beverage, he said.

“The consolidated new company will result in a low public float, that is why they need to issue new shares to the public to be able to meet the minimum requirement,” said Noel Reyes, chief investment officer at Security Bank Corp which manages around $1 billion in funds.

The Philippines’ corporate regulator requires listed companies to increase their public float to at least 15 percent on or before the end of 2018, and to at least 20 percent on or before the end of 2020.

To date, Pure Foods’ public float is 14.6 percent, with parent firm San Miguel owning a majority stake.

The share swap will result in synergies in the food and beverage units, unlock shareholder value and provide investors direct access to the consumer business of the conglomerate, San Miguel told the local exchange on Wednesday. (

Shares in Pure Foods jumped 11 percent and Ginebra surged 33.7 percent, outperforming the broader market which ended nearly flat. San Miguel rose 0.8 percent. (Reporting by Neil Jerome Morales; Editing by Manolo Serapio Jr.)

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