San Miguel Has Purchase Offers for Power, Bank Stakes, Ang Says
The company is considering selling 40 percent of Bank of Commerce after Malaysia’s CIMB Group Holdings withdrew its offer, Ang told reporters after its beer unit’s shareholder meeting in Manila yesterday. San Miguel will also sell this year a 49 percent stake in SMC Global Power Holdings Corp., the nation’s largest electricity generator, he said, without identifying potential buyers.
The company that started as a brewer in 1890, eight years before the Philippines declared independence from Spain, has expanded into airlines, cement, oil, mining and toll roads. San Miguel is pursuing a plan to build a $6 billion airport in Manila, while output of a cement company, where it bought a 35 percent stake, will be doubled to 8 million tons in a couple of years, Ang said yesterday.
“The sale will improve the company’s liquidity,” Jomar Lacson, an analyst at brokerage Campos Lanuza & Co., said by phone in Manila. “The additional cash will help especially since they’re planning to go into several infrastructure projects that require significant capital.”
Shares of San Miguel, which also controls the nation’s largest oil company Petron Corp. (PCOR), rose 2.4 percent to 89 pesos in Manila yesterday. The stock has fallen 16 percent this year, compared with the benchmark stock index’s 10 percent gain.
San Miguel, which acquired 49 percent of Philippine Airlines Inc. in April last year, said on July 8 it held talks with ANA Holdings Inc. about investing in the flag carrier. The company is considering selling its 32.8 percent stake in Manila Electric Co. (MER), the nation’s largest power retailer, in parts, Ang said on June 11. The stake is worth 117.6 billion pesos ($2.7 billion) at current prices.
SMC Global Power, which accounts for a fifth of the nation’s generation capacity, has a minimum equity value of $1.5 billion, Ang said yesterday.
CIMB scrapped a plan to buy San Miguel’s 60 percent stake in Bank of Commerce, the 17th-biggest lender in the Philippines, for 12.2 billion pesos after failing to reach agreement, the Malaysian lender said on June 21. Bank of Commerce has assets of 92.7 billion pesos at the end of last year, according to central bank data.
San Miguel is “still pursuing diversification,” Ang said yesterday. “We are at 60 percent of where we want to be.”