San Miguel, Coca-Cola Amatil finalize 2.7-b stock swap
San Miguel, Coca-Cola Amatil finalize 2.7-b stock swap
MANILA (AFP): The Philippines' San Miguel Corp. and Coca-Cola Amatil Ltd. of Australia said yesterday they had agreed on US$2.7 billion deal to integrate their soft drinks operations through a stock swap.
San Miguel, a diversified beer-based consumer company with operations in China, Indonesia, Vietnam and Hong Kong, said in a statement here that the two firms had signed "definitive agreements" for the merger.
A formal exchange of shares, worth a total 2.7 billion dollars, would take place on July 1, it added.
The signing finalizes an agreement in principle announced in April by both San Miguel and Coca-Cola Amatil to merge their operations to create the largest Coca-Cola bottling group outside the United States.
Under the deal, San Miguel will swap 70 percent of its equity in Coca-Cola Bottlers Philippines Inc. for a 25 percent stake in Coca-Cola Amatil.
Four San Miguel nominees will be invited to join the board of the Coca-Cola Amatil, the statement said.
The merger will make San Miguel the second-largest shareholder of Coca-Cola Amatil after The Coca-Cola Company of the United States.
"The transaction greatly expands Coca-Cola Amatil's presence in Asia and makes it the largest Coca-Cola anchor bottler outside the United States with a consumer base of 450 million people accounting for approximately eight percent of worldwide unit sales of The Coca-Cola Company," the statement said.
The Philippine government, which owns 48 percent of San Miguel, had earlier questioned the deal and said it would call for a renegotiation to increase San Miguel's share to at least 30 percent and the number of board seats from three to four.
Some analysts have criticized the merger as "disadvantageous" to San Miguel, saying Coca-Cola Amatil was not as profitable as Coca-Cola Bottlers Philippines.
On the Philippine Stock Exchange on Wednesday, San Miguel Corp.'s A shares eased one peso to 49 pesos and its B shares lost 50 centavos to close at 78 pesos.