Del Monte Philippines embarks on South East Asia’s largest food and beverage IPO in six years

By Lester Wan contact

- Last updated on GMT

Del Monte Pacific plans to sell 20% of its stake in Del Monte Philippines through a secondary share offering. ©DelMonte
Del Monte Pacific plans to sell 20% of its stake in Del Monte Philippines through a secondary share offering. ©DelMonte

Related tags: Stock market, Southeast asia

Del Monte Philippines is to embark on an initial public offering (IPO) in a bid to raise Ps16.72b (about US$324.1m) – South East Asia’s largest for a food and beverage firm since 2012.

A recent filing with the Philippine Stock Exchange (PSE) stated that Del Monte Pacific plans to sell 20% of its stake in Del Monte Philippines through a secondary share offering.

The planned offering of 559.464 million shares at an expected share price of Ps29.88 each would also make it the largest IPO in the Philippines since October 2016.

“The company plans to use the expected proceeds from the offering primarily for debt repayment and general corporate purposes,”​ said company secretary Antonio Eugenio Ungson.

"The prepayment of such loans will allow the Del Monte Pacific Group to de-leverage and strengthen its balance sheet,"​ said the statement.

The company appointed BDO Capital & Investment Corp. to be the issue manager, sole global coordinator and sole book runner for the offering.

“The offering will be subject to receipt of the requisite regulatory approvals and market conditions,” ​said Ungson.

Bonds still strong

Del Monte Pacific has agreed to commit to owning at least 67% of its shareholding in Del Monte Philippines for the next five years following the public offering.

The company will be seeking its shareholders’ approval for the offering at an extraordinary general meeting to be convened soon.

Del Monte Pacific Ltd is listed on both the Singapore stock exchange (SGX) and the Philippine Stock Exchange (PSE) under a dual-listing scheme. The company has 19 factories around the world.

According to Del Monte Pacific, about two-thirds of Del Monte Philippines’ sales come from within the country, mainly under the Del Monte brand, while the rest constitutes export markets under the S&W brand as well as other private labels.

Del Monte Philippines claims to operate the largest integrated pineapple operation in the world, growing pineapples across 20,000 hectares, and to account for a tenth of the world's annual production of processed pineapple products.

The company is a market leader in tinned pineapple juice and juice drinks, pineapple and tropical mixed fruits, tomato sauce, spaghetti sauce and tomato ketchup.

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