San Miguel Corporation
San Miguel eyes energy projects in Indonesia, Australia, says Ang

MANILA, Philippines — San Miguel Corp., the Philippines’ largest listed company by sales, is considering energy investments in Indonesia and Australia to expand in markets overseas following a series of acquisitions at home.

“That’s what we’re aiming for,” President Ramon Ang told reporters. “Be it coal or natural gas, as long as it’s energy related.”

The company that’s been a brewer for more than a century, has been expanding into industries such as oil, mining, power and infrastructure to boost return on equity to three times the 7 percent level it used to earn from food and drinks alone. It has spent at least $4.5 billion on acquisitions in the past three years and had $2.9 billion in cash at the end of December, according to data compiled by Bloomberg.

San Miguel will likely reach an agreement on an overseas acquisition in August, Ang said on July 6. Last month, he said it is targeting a company in Asia that’s “very profitable” and has “big potential.” He declined to talk about it yesterday.

The company’s profit in the first half rose “double digit” from a year earlier, boosted by energy investments led by Petron Corp., Ang said. Profit at Petron, the nation’s biggest oil company, also increased double-digit, he said, without elaborating.

San Miguel’s net income in the three months ended March more than doubled to 7.14 billion pesos ($170 million) from 2.9 billion pesos a year earlier.

Petron will “for sure” sell shares this year to meet the stock exchange’s minimum public ownership requirement and raise funds for expansion, Ang said. The company, which accounts for about a third of the domestic oil market, will probably contribute about 230 billion pesos to San Miguel’s sales this year, making it the single-biggest source of revenue, Ang said on Feb. 3.

San Miguel shares have fallen 22 percent this year compared with the 6.4 percent advance in the benchmark Philippine Stock Exchange Index. The stock was unchanged at 127.90 pesos as of 11:09 a.m. in Manila trading. Petron, which has declined 15 percent this year, rose 0.3 percent to 16 pesos.

San Miguel plunged the most in more than 21 years on May 5 after raising about $1 billion selling shares and convertible bonds at a discount.

In addition to its controlling stake in Petron, San Miguel owns power plants that provide more than a fifth of the country’s electricity requirements and a 10 percent interest in Australia-based miner Indophil Resources NL. Indophil holds a third of Tampakan, the largest untapped gold and copper deposit in Southeast Asia.

San Miguel, which has said it expects new businesses to make up 70 percent of revenue in five years, also owns a stake in Manila Electric Co., the nation’s largest power retailer, and has investments in companies with rights to build airports, toll roads and rapid rail transit. (Bloomberg)

3 Spanish firms interested in Phl

MANILA, Philippines - Three Spanish firms Union Fenosa International SA, Gamesa and Grupo Leche Pascual are interested in investing in the Philippines, the Board of Investments (BOI) said yesterday.

BOI managing head Cristino L. Panlilio said that during his recent visit to Spain, he met with these firms which expressed interest in the Philippines.

Union Fenosa is already into oil exploration in the Philippines but Panlilio said the other expertise of the firm is power plant. “We are asking for natural gas exploration and operation,” Panlilio said.

The Gamesa on the other hand manufactures wind turbines. Panlilio said they would like more wind power projects here. With more than 15 years experience, Gamesa is a world leader in the design, manufacture, installation and maintenance of wind turbines, with around 22,000 MW installed in 30 countries on four continents and 14,000 MW under maintenance.

The company has 30 production facilities in Europe, the US, China, India and Barzil and close to 8,000 employees worldwide.

Another Spanish firm Leche Pascual has already signed a contract and is in the final stages of partnership with a Filipino firm for a yoghurt manufacturing plant here. Panlilio said the project may be done in partnership with San Miguel Corp., Del Monte, Alaska or Asia Brewery.

Leche Pascual has already committed to invest in the Philippines last year when then President Arroyo visited Madrid in 2010. Then Trade Secretary Jesli A. Lapus met with Leche Pascual officials who said they would like to put up a plant here.

Leche Pascual is the only firm accredited to sell throughout the European Union. The company has embarked on a new international expansion strategy which has identified three target regions for the global market expansion. The countries are South Africa for Africa, Venezueala for South America and Philippines for Southeast Asia.

The company said they are confident that they will be able to develop the market in the Philippines for yoghurt products. Aside from the significant employment generation, the company is also confident that it can improve the nutritional level of the population.

Likewise, this will improve the image of the Philippines as an ideal investment site and regional manufacturing base and distribution center, encouraging other big Spanish investors to follow.

Philco Aero owner SMC seeks faster DMIA T2 project negotiations

Philco Aero owner SMC seeks faster DMIA T2 project negotiationsAugust 9, 2011, 2:58pmMANILA, Philippines — Diversified conglomerate San Miguel Corporation (SMC), which recently completed its acquisition of Philco Aero Inc. is asking the Clark International Airport Corporation (CIAC) to resume and accelerate their long-delayed negotiations for the US$177-million Diosdado Macapagal International Airport (DMIA) Terminal 2 Project.

Philco Aero, a Filipino-Korean consortium, is the original private proponent of the DMIA T2 project whose unsolicited proposal for this multi-million dollar venture was accepted by the CIAC Board of Directors on May 17, 2010.

SMC has put up a holding company which recently acquired 70% of Philco Aero for an undisclosed amount to conclude a transaction that began early last year. Penson and Company Inc., SMC’s partner in the venture, will own 30% of the holding company.

After a meeting with SMC, Philco Aero President and CEO Ricardo L. Penson disclosed that SMC was keen on advancing the long delayed negotiations with CIAC for T2 project as “the delay is causing irreparable inconvenience to the public in general and to the PPP (public-private partnerships) efforts of the Aquino administration in particular, which we fully support.”

According to the provisions of the Detailed Guidelines for Competitive Challenge Procedure for Public-Private Joint Ventures of the National Economic and Development Authority (NEDA) which cover PPPs, once the concerned government agency accepts a project proposal, it goes on to the next step in the process: The detailed negotiation stage.

Philco Aero, Penson said, has already forwarded to CIAC all the supporting documents on the technical and financial aspects of their proposal.

"We are, thus, fully prepared for the continuation of detailed negotiations in accordance with Stage 2 of NEDA’s JV guidelines,” he added. “We reaffirm and stand by the technical feasibility and viability of our proposal, and we are looking forward to the detailed negotiation stage, as well as the final ‘Swiss challenge’ phase where any competing bidder can challenge our proposal.”

Philco Aero, he added, is studying all available legal remedies to jumpstart the process which was initially delayed by politics while awaiting new appointees to CIAC, and then by the CIAC’s commissioning of a new airport master plan late last year.

“This matter should have been discussed with us first during the negotiation phase in August last year instead of being used, in bad faith, as an excuse to set aside the Notice of Acceptance issued to Philco Aero,” Penson stressed. He noted that the holding company, which is envisioned to serve as SMC’s infrastructure arm, is eager to add the DMIA T2 project to its airports portfolio following its concession to the Boracay gateway, Caticlan International Airport, which was inaugurated by President Aquino last June.

Philco Aero has partnered with Korea Airport Corp. and Korea Telecom for the operations, maintenance and system integration of the project. Both entities will hold minimal equity in the company. Recently, the Korean embassy in support of this and other infrastructure projects announced a $500-million economic package for the Philippines.

SOURCE: Manila Bulletin Publishing Corp.
San Miguel says first half revenues grew 168% to P263B
Saturday, August 13, 2011 12:03 AM
San Miguel Corporation (SMC) said Friday "robust first-half results" largely from its two energy firms, boosted its consolidated revenues by 168 percent to P263.3 billion and sent net income rising by 72 percent to P10.8 billion.

"We are continuously benefiting from our strategic shift to high-growth businesses," SMC chairman and CEO Eduardo M. Cojuangco Jr. said in a prepared statement.

Petron Corp., majority controlled by San Miguel, made P134.9 billion in net sales during the first semester, up 17 percent from P115.35 billion a year earlier.

San Miguel Global Power pitched in P35.6 billion in net sales, for a 48 percent jump from P24.14 billion.

SMC said its "traditional businesses… continue to be a major contributor" to the diversifying conglomerate's revenue stream.

San Miguel Brewery net sales rose 7 percent to P35.59 billion, coming from a 5 percent increase in sales volume to 114.7 million cases.

The San Miguel Food Group contributed P42.3 billion in net sales, up 11 percent while the Yamamura Packaging unit added P11.98 billion in net sales.

Net sales of Ginebra San Miguel fell by 27 percent from P11.2 billion to P8.19 billion, because of 30 percent decline sales volume.

SMC corporate information officer Ferdinand K. Constantino said in a disclosure to the Philippine Stock Exchange that SMC Global Power Holdings Corp. will conduct an initial public offering "towards the latter part of the year."

Constantino also revealed that the SMC board of directors approved the sale of P12.99 billion worth of its Meralco shares to the San Miguel Pure Foods Company Inc. He said these shares form part of the fully-paid stocks bought from the Government Service Insurance System. — ELR/VS, GMA News
Guys, since im a newbie in stock markets, what effect would this positive news like the above would have on the stock price? Before i wold have assumed it would be an obvious increase, pero nowadays im not sure anymore bec of the complexities of the market..hehe

Sayang nga, last week when smc's price dropped to 11x levels i wanted to buy more ( i already had some) bec i knew it was a bargain... Pero naubusan ako ng bala kasi i also bought MBT..hehe .. Dedeposit sana ako kaso 3 days pa mag clear.. Hehe


More Positive news?

[quote]San Miguel to buy Exxon stake in Malaysia's Esso-sources
Written by Reuters
Wednesday, 17 August 2011 14:00

KUALA LUMPUR/MANILA: Philippine conglomerate San Miguel , which is aggressively expanding into infrastructure, will buy ExxonMobil's 65 percent stake in Malaysian oil refiner Esso , two sources with direct knowledge of the deal told Reuters.

The value of the deal was not immediately available. Esso's market cap on Wednesday, Aug 17 was about 1.17 billion ringgit ($392.55 million), and Exxon's 65 percent stake valued at about 760 million ringgit.

The Philippine company has diversified its portfolio in recent years, spinning off its traditional brewing business and moving into areas such as domestic power, telecommunications, infrastructure, and energy.

At the same time, ExxonMobil has been actively reviewing its Asian assets and earlier this month agreed to sell its stake in three companies associated with the Indonesian gas and liquefied natural gas business.

Reuters also reported earlier this year that Thai Oil was looking at buying ExxonMobil's Esso in Thailand.

Officials with Esso and San Miguel could not be immediately reached for comment.

Esso's operations in Malaysia include a refinery located in Port Dickson on the west coast and a chain of 560 retail stations across the country.

Built in the 1960s at an initial cost of 50 million ringgit, the Port Dickson refinery has a processing capacity of 88,000 barrels of crude per day (bpd), but it averaged 45,000bpd in 2010, according to the company's 2010 annual report.

"San Miguel won the bid because it was the highest bidder and was willing to invest in Esso's refinery to bring it up to speed," one of the sources told Reuters.

He said that the investment by San Miguel will allow the Port Dickson refinery to process other types of products from the refinery.

The refinery presently produces a range of products including gasoline, diesel, liquefied petroleum gas (LPG), jet fuel, kerosene and low-sulfur waxy residue.

Cash-rich San Miguel said on Tuesday it had received proceeds worth 13 billion pesos ($306.7 million) from a share purchase deal covering a portion of its stake in Manila Electric Co . It sold the unit to its food arm, San Miguel Pure Foods , giving the parent fresh funds for new acquisitions.

San Miguel owns a majority share of the Philippines' largest oil refiner, Petron Corp , and the Esso purchase will widen the group's exposure in the oil refinery and distribution business.

In Malaysia, shares of Esso fell 0.2 percent on Wednesday at the close of the morning trading session to 4.33 ringgit.
SMC power unit to raise P35.5 billion via IPO

MANILA, Philippines - SMC Global Power Holdings Corp., the energy arm of food-to-infrastructure conglomerate San Miguel Corp., is targeting to raise up to P35.5 billion from an initial public offering (IPO) of shares to fund its massive expansion initiatives in the country’s power industry.

The San Miguel Group is returning to the local market with SMC Global Power’s IPO, which is likely to become the biggest on record in the Philippines. The parent firm raised around $900 million (P38.23 billion) from a follow-on offering of shares in April.

In its registration statement, SMC Global Power said it is selling 300 million to 500 million common shares through a primary and secondary offering at a price range of P44 to P71 each share.

Standard Chartered Securities (Singapore) Pte. Ltd. is SMC Global Power’s sole financial adviser as well as joint bookrunner and international manager, along with Goldman Sachs Pte. and UBS AG.

On the other hand, ATR KimEng Capital Partners Inc. and SB Capital Investment Corp. will serve as domestic lead underwriters.

SMC Global Power intends to use proceeds from the offering to develop greenfield power projects, acquire existing power generation capacities, and for general corporate purposes.

The company is the advance stages in the planning of two clean coal greenfield power projects with a combined capacity of 450 megawatts and is considering additional greenfield power projects with an aggregate capacity of up to 3,000 MW over the next five to seven years.

SMC Global Power is likewise also preparing to bid for selected National Power Corp-owned power generation plants scheduled for privatization.

The company is pursuing vertical integration of its power business. By capitalizing on changes in the regulatory structure to expand its sales of power to a broader range of customers, including retail customers. As part of the reorganization of the power related-assets of San Miguel, SMC Global Power acquired a 100 percent interest in San Miguel Electric Corp. which is in the process of obtaining a retail electricity license from the Energy Regulatory Commission.

Once open access and retail competition are implemented in December 2011, the electricity supplier license will allow SMC Global Power to enter into offtake agreements with customers with power requirements of at least one MW.

SMC Global Power is now one of the largest power firms in the country, holding a 17. 5 percent market share of the power supply of the national grid and a 23.5 percent market share of the Luzon grid.

It has acquired coal exploration, production and development rights over approximately 17,000 hectares of land in Mindanao. If it is able to develop these assets and commence mining operations successfully, SMC Global Power expects these assets will provide a source of coal fuel supply for its planned greenfield power projects.

SMC to spend $1B to upgrade Malaysian refinery

KUALA LUMPUR -- Philippine conglomerate San Miguel Corp. (SMC) plans to spend $1 billion over three to five years to upgrade a Malaysian oil refinery it bought from Exxon Mobil in August, the Business Times reported on Monday.
The paper cited San Miguel Director Eric O. Recto as saying that the investment will help ramp up the capacity of the company’s newly acquired refinery that now stands at 88,000 barrels per day.

“We are looking at the same achievement we did when we acquired Petron Corp. three years ago,” Mr. Recto was quoted as saying.

Petron’s Philippine refinery currently operates at 180,000 barrels per day.

San Miguel was not immediately available for comment.

San Miguel struck deals on Aug. 17 to buy Exxon Mobil’s Malaysia assets for $610 million, including the refinery in central Port Dickson, petrol stations and fuel distribution terminals.

The conglomerate had signed purchase agreements for Esso Malaysia Bhd, a publicly traded company of which Exxon Mobil International Holdings, Inc. owns a 65% stake, and wholly owned ExxonMobil Malaysia Sdn Bhd and Exxon Mobil Borneo Sdn Bhd.

Mr. Recto said San Miguel will use borrowings to fund 70% of the deal and finance the rest with cash from its Malaysian business.

The Esso Malaysia Bhd purchase presents a new diversification move for San Miguel as it has recently earned P13 billion from selling its shares in Manila Electric Co. to its food unit San Miguel Pure Foods.

San Miguel, which has been diversifying from its traditional food and beverage business to areas such as infrastructure, telecommunications and energy, will see its exposure to the oil business expand once the deal is finalized. ExxonMobil has been actively reviewing its Asian assets and earlier this month it agreed to sell its stake in three companies associated with the Indonesian gas and liquefied natural gas business.

Thai Oil was said to be also interested in buying Esso in Thailand.

Date: August 30, 2011

Back in the saddle
San Miguel Corp. is scheduled to be readmitted into the main share index of the Philippine Stock Exchange next month after a 10-month absence—the only time in the bourse’s history when the conglomerate was not part of the benchmark.
Theoretically, the company had complied with the bourse’s 12-percent free float requirement as early as four months ago when it sold additional shares to the public, but had to wait in the wings for the PSE’s regular index adjustment schedule. Of course, the companies of the San Miguel group are the most valuable in the country in terms of market capitalization, with total value of P1.13 trillion as of last week.
This was followed by the PLDT group with a combined market capitalization of P866.5 billion (including Meralco’s P290.8 billion); the SM group with P808.4 billion; the Ayala group with P766.8 billion; and the Gokongwei group with P439.1 billion.—Daxim L. Lucas
the key to trading success is to focus on how much money is at risk, not how much money you can make.

trading is simple, but it's not easy. if you want to stay in the business, leave hope at the door, focus on specific setups, and stick to your stops.
good morning boss aiu!
sana pagbalik ni SMC sa index, bumalik na rin sya sa P180 Big Grin
"“You can’t cross a sea by merely staring into the water.” -Rabindranath Tagore

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