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MANILA - San Miguel Corporation has received regulatory approval to hike its authorized capital stock to cover the recently concluded sale of its preferred shares worth P80.025 billion.
In a disclosure to the Philippine Stock Exchange, the diversifying food-and-beverage conglomerate said the Securities and Exchange Commission cleared the increase in its authorized capital stock from P22 billion to P30 billion, consisting of 3.79 billion common shares, 1.11 billion Series 1 preferred shares and 1.1 billion Series 2 preferred shares all with a par value of P5 apiece.
San Miguel recently concluded the sale of 1.067 billion Series 2 preferred shares at P75 apiece to institutional and retail investors. The shares were taken out of the increase in the company’s authorized capital stock.
San Miguel tapped Hongkong and Shanghai Banking Corp. as the sole issue manager. HSBC also serves as bookrunner, along with Union Bank of the Philippines, BDO Capital & Investment Corporation, China Banking Corporation, RCBC Capital Corporation, First Metro Investment Corporation, ING Bank N.V.-Manila Branch, Philippine Commercial Capital Inc., Standard Chartered Bank, SB Capital and Investment Corporation and United Coconut Planters Bank.
Preferred shares offer a higher dividend rate than common stocks, and usually carry no voting rights. The San Miguel preferred shares will pay annual fixed dividend rates of 7.5-8 percent.
San Miguel will use net proceeds of P78.45 billion to refinance P72.8 billion in Series 1 preferred shares and for general corporate purposes, which may include the partial payment of short-term debt reaching P13.995 billion.
Listing and trading of the shares at the PSE starts on October 12.
San Miguel has been trimming its stake in its traditional businesses of food, beverage and packaging since 2007 to support its diversification into infrastructure, power, oil retailing, telecommunications and mining.
It recently entered the airline business through the acquisition of a significant stake in Philippine Airlines.
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