San Miguel Corporation
Business Profile:

San Miguel Corporation (SMC or the Parent Company), together with its subsidiaries (collectively referred to as the Group), is one of the largest companies in the Philippines in terms of market capitalization and is a highly diversified conglomerate. It has leading businesses in beer, liquor, food, packaging, power and fuel and oil.

SMC’s traditional businesses comprise primarily of beverage, food and packaging products. SMC recently has embarked on a diversification strategy and has expanded into a number of new businesses, including power, fuel and oil, infrastructure, mining, telecommunications, property development and other businesses outside of its traditional businesses. SMC has implemented this strategy through a series of acquisitions and investments.

As part of its growth strategy, SMC, either directly or through its subsidiaries and affiliates, has made a series of acquisitions in the fuel and oil, power, infrastructure, telecommunications, banking and mining industries over the past three years.

A summary of these transactions is set forth below.

• SMC has 68.26% equity interest in Petron Corporation (Petron)
• SMC has acquired the rights, pursuant to IPPA agreements with Power Sector Assets and Liabilities Management Corporation to administer three power plants in Sual, Ilijan and San Roque. SMC acquired the Limay Power Plant, which it operates as the Independent Power Producer (IPP).
• SMC owns a 33.19% equity interest in the Manila Electric Company

• SMC made the following infrastructure acquisitions:

a. A 35.0% equity interest in Private Infra Dev Corporation (PIDC)

b. A 93.0% equity interest in Trans Aire Development Holdings Corp. (TADHC, formerly known as Caticlan International Airport Development Corporation)

c. A 51.0% equity interest in Universal LRT Corporation (BVI) Limited
(Universal LRT)

• SMC made the following telecommunications acquisitions:

d. A 41.5% equity interest in Liberty Telecoms Holdings, Inc. (LTHI)

e. A 100.0% equity interest in Bell Telecommunications Philippines (BellTel)

f. Through the acquisition of 100.0% of the issued and outstanding shares of A.G.N. Philippines, Inc. (AGNP) acquired a 40.0% in Eastern
Telecommunications Philippines, Inc. (Eastern Telecoms)

• SMC made the following mining acquisitions:

g. A 100.0% equity interest in each of the three concession holders of coal deposits in the Southern Mindanao region – namely, Daguma Agro Minerals, Inc., Bonanza Energy Resources, Inc. and Sultan Energy Phils. Corp.

h. A 10.1% equity interest in Indophil Resources NL (Indophil), which indirectly holds a 37% equity interest in a joint venture entity with rights to explore, develop and operate the Tampakan copper and gold project in the Southern Mindanao region

• As of December 31, 2010, a 32.8% equity interest in Bank of Commerce

Established in 1890 as a single-product brewery, SMC has transformed itself from a market leading beverages, food and packaging business with a globally recognized beer brand, into a large and diversified conglomerate with additional markets, leading businesses and investments on power, fuel and oil, infrastructure, telecommunications, banking and mining industries.

In 2010, the Group accounts for about 2.52 % of the country’s gross national product and 2.89% of the country’s gross domestic product.

The Group’s flagship product, San Miguel Beer, is among the world's largest selling beers and among the top brands in Southeast Asia.
From its original cerveza, the Group now owns a wide range of popular beverage brands and products that extends from beer to hard liquor, bottled water, powdered juice and juice drinks.

The Group's food operations includes the production and marketing of fresh, ready-to-cook and processed chicken, fresh pork and beef and value-added meats, milk, butter, cheese, margarine, ice cream, flour products, coffee, cooking oil and animal and aquatic feeds.

Through the partnerships it has forged with major international companies, the Group has gained access to the latest technologies and expertise, thereby enhancing the Group’s status as a world-class organization.

The Parent Company has strategic partnerships with international companies, among them Nihon Yamamura Glass Company, Ltd. (NYG), Hormel Foods International Corporation (HFIC) of the United States, Super Coffee Corporation Pte Ltd (SCCPL) of Singapore and Kirin Holdings Company Limited (Kirin), one of the largest beer manufacturing companies in Japan.

The Group is one of the nation’s biggest private employers with an estimated 16,700 employees. In addition, the Group contributes to the growth of downstream industries and sustains a network of hundreds of third party suppliers in 2010.

Source: Annual Report 2010

Attached Files Image(s)

2011 vs. 2010

San Miguel Corporation’s consolidated sales revenue for first quarter of 2011 amounted to P126,570 million, nearly three times higher than last year’s level. The consolidation of Petron and SMC Global brought in additional revenue of P78,893 million in the first quarter while most of the existing businesses showed revenue growth versus last year. Correspondingly, first quarter 2011 consolidated operating income amounted to P17,291 million, almost three times higher than last year’s level.

Equity in net earnings of associates decreased in 2011 mainly due to consolidation of San Miguel Energy Corp. (SMEC) and Strategic Power Devt. Corp. (SPDC), formerly associates of SMC in the first quarter of 2010, net of SMC Global’s share in net income of the Manila Electric Company (Meralco) in the first quarter of 2011.

Net financing charges increased to P5,306 million from P1,081 million mainly due to higher debt balance in 2011 and the interest expense on finance lease liabilities of SMC Global.

With the equity in net earnings of associates, net of financing and other charges, the Group’s resulting consolidated net income attributable to equity holders of the Parent Company amounted to P7,138 million, more than twice that of last year’s net income.

Source: Q1 2011 Financial Report
San Miguel acquires Keppel’s shipyard in Cebu

SAN MIGUEL Corp.’s shipping unit has acquired majority control over the Cebu shipyard of Keppel Philippines Holdings, Inc. for P596.2 million, a disclosure filed with the local bourse on Friday showed. Keppel, in the disclosure, said it has agreed to sell a 72% stake in Keppel Cebu Shipyard Land, Inc. as commercial operations on the site have already ceased anyway.

"The sale was approved as [we] no longer has shipyard operations on the said land," Keppel said, noting that the sale involved 36.07 million shares.

The "deed of absolute sale of shares and irrevocable proxy" was executed on Friday by Goodsoil Marine -- the Keppel unit in charge of the Cebu subsidiary -- and San Miguel’s SMC Shipping and lighterage Corp.

Goodsoil Marine reportedly received the full payment in cash on the same day.

SMC Shipping and Lighterage acquired shares in the Cebu shipyard "to expand their business interest," Keppel claimed.

SMC Shipping and Lighterage, which is 70% owned by San Miguel, is the group’s cargo handling and warehousing arm.
SMC unit seeks foreign partners

THE INFRASTRUCTURE arm of San Miguel Corp. (SMC) plans to partner up with a foreign firm when it bids for the government contract to operate and maintain two existing passenger trains serving Metro Manila, an executive of the parent firm yesterday said.
“There is a need for foreign technical partners, and that is what we’ll look for… We are talking to a number of firms at present but I can’t say who,” Ramon S. Ang, San Miguel president, told reporters in Filipino in a chance interview.

The conglomerate’s Optimal Infrastructure Development, Inc. is one of the 45 firms that had earlier expressed formal interest to bid for the P15-billion four- to five-year contract to operate Light Rail Transit Line 1 (LRT-1) and the Metro Rail Transit Line 3 (MRT-3).
SMC plans to increase stake in Eastern Telecom to majority

MANILA, Philippines - San Miguel Corp. (SMC), through its wholly-owned subsidiary Vega Telecom Inc., is eyeing a majority stake in Eastern Telecommunications Phils. Inc. (ETPI), a company controlled by businessman and former Trade Minister Roberto Ongpin, in a bid to fortify its presence in the local telecommunications sector.

SMC president and chief operating officer Ramon S. Ang revealed that Vega Telecom is “likely to acquire” the remaining 37.7 percent stake of ISM Communications Inc. in ETPI.

The 37.7-percent stake of the Ongpin group in ETPI has a book value of P1.14 billion.
Annual Stockholders Meeting tomorrow. May good news kaya? Let's wait and hear Wink

Cash: Php 0.35 per share
Ex-Date: July 5, 2011
Record Date: July 8, 2011
Payment Date: July 22,2011
nihil timendum est.
[Image: SMC6-7-11.jpg]
San Miguel resists Indophil share sale, insists on 51% stake

SAN MIGUEL Corp. said it was not interested in acquiring more shares in Indophil Resources NL, one of the foreign backers behind the $5.9-billion Tampakan copper-gold deposit in Mindanao, unless enough stocks were offered up for the diversified conglomerate to secure majority control.

“They will have to agree to a 51% [San Miguel stake] [and other] issues like that,” San Miguel President and Chief Operating Officer Ramon S. Ang told reporters in a chance interview late last week.

The remark comes as Indophil rolls out an A$189.5-million share sale, allowing each existing shareholder to buy as much stocks as they already own.
SMC unit, PBCom in talks

The Bank of Commerce, a unit of conglomerate San Miguel Corp. (SMC), is emerging as the most likely firm to acquire the Philippine Bank of Communications (PBCom), a banking source familiar with the deal said late on Friday.

The same source said the Bank of Commerce is at present “conducting due diligence” relating to the acquisition of PBCom.

Officials of both PBCom and the Bank of Commerce were not immediately available for comment. It also remains uncertain if the Bank of Commerce has offered to acquire PBCom on its own, or in partnership with other groups.

Last week ISM Communications Corp., a listed firm controlled by the group of former Trade minister Roberto V. Ongpin, said it was interested in acquiring a controlling stake in PBCom.

Ongpin is a shareholder of Top Frontier Investment Holdings Inc., which owns a controlling stake in SMC, and is, in turn, 49-percent owned by the diversified food-and-drinks giant.

SMC, through subsidiary San Miguel Properties Inc., and with other entities, controls close to 60 percent of the Bank of Commerce. The bank reported a net income of P1.81 billion in 2010, up 2.43 percent from the previous year, data from its web site showed. Its total assets stood at P105.89 billion in 2010. Total deposits and net loans stood at P87.19 billion and 35.87 billion, respectively, data showed.

In a statement earlier this year, the Bank of Commerce said it has 117 branches; PBCom has 64 branches, based on its report to the Philippine Stock Exchange.

The Macquarie group is reportedly advising PBCom in the deal. The floor price was reportedly set at P4.3 billion, or a minimum of P25 per share.

PBCom said its first-quarter net income rose 97.2 percent to P71 million, while deposits amounted to P26.1 billion from P27.6 billion at the end of 2010.

PBCom shares sank 5.63 percent to P67 each on Friday.
SC: It's final, Cojuangco's San Miguel shares legit
Posted at 06/21/2011 5:45 PM | Updated as of 06/21/2011 6:43 PM

MANILA, Philippines - The Supreme Court has affirmed with finality that businessman Eduardo "Danding" Cojuangco's block of shares in San Miguel Corp., which was sequestered by government along with the ill-gotten wealth of late dictator Ferdinand Marcos and his cronies, was legally acquired.

The High Tribunal, during its regular en banc session on Tuesday, dismissed the motions filed by the Presidential Commission on Good Government (PCGG) and multi-sectoral group led by former Senators Jovito Salonga and Wigberto Tañada, seeking the reversal of the court’s decision on April 12.

The SC had declared as legitimate Cojuangco's 20% San Miguel stake, debunking PCGG's claim that this was acquired using coconut levy funds.

The petitioners argued that Cojuangco "judicially admitted" he acquired the said San Miguel block of shares using proceeds of loans from the United Coconut Planters Bank (UCPB) and credit advances from the Coconut Industry Investment Funds (CIIF) Oil Mills, the repositories of coco levy funds.

The levy (a kind of tax) was paid by coconut farmers whenever they sold copra during the period August 1973 to 1982.

Cojuangco, said to be one of the close associates of Marcos, was director of the CIIF Oil Mills and the Philippine Coconut Authority, and chairman of UCPB at the time the San Miguel shares were purchased. Thus, the government claimed he took advantage of his positions in these entities and breached fiduciary duties for personal gain.

In its final ruling, the SC said the petitioners failed to present new arguments that would warrant the reversal of its previous decision.

It concluded that no further pleadings will be entertained in connection with the case, and ordered that an entry of judgment be made.

In its April 12 decision, the SC also affirmed the lifting of the writ of sequestration over the Cojuangco block.
SMC to invest in airports

AKLAN—San Miguel Corp. (SMC) is investing at least $300 million to expand the Caticlan Airport, the country’s nearest gateway to Boracay island.
SMC owes gov’t P17.6B–PCGG

MANILA, Philippines—Even excluding the 20 percent share of former Marcos crony Eduardo Cojuangco, the San Miguel Corporation (SMC) still owes the government P17.65 billion worth of shares, according to the Presidential Commission on Good Government (PCGG).

The PCGG has filed a petition before the Supreme Court seeking to compel the food and beverage giant to deliver the sequestered shares, which represent four percent of the SMC shares owned by the Coconut Industry Investment Fund (CIIF).

The so-called “CIIF block,” according to the PCGG is “separate and distinct” from the shares recently cleared by the high court as legally belonging to Cojuangco, President Aquino’s uncle and chair of SMC.

In a petition filed Monday, PCGG sought SMC’s compliance with a September 2000 Supreme Court order upholding a Sandiganbayan resolution awarding the PCGG some 26,450,000 of SMC shares held in trust for coconut farmers.

“We are merely seeking to implement a final and executory decision of the Supreme Court and the Sandiganbayan,” PCGG Chair Andres Bautista said.

“The Court decided this matter a long time ago. It’s about time the Republic got back what rightfully belongs to it—the shares in trust for the Filipino coconut farmer,” Bautista said in a statement.

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