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Wednesday, October 15, 2014

Del Monte Pacific to sell shares at a discount

Del Monte Pacific Co Ltd has priced its follow-on offering way below the ceiling, amid a worldwide sell down of equities on concerns over anemic global economic growth.

In a disclosure to the Philippine Stock Exchange, the fruit grower and canner said it would raise P93.50 million from the sale of 5.5 million new shares after setting the offer price at P17 per share.

The price represents a premium of 1.65 percent to the volume weighted average price for trades done on both the PSE and the Singapore Exchange Securities Trading Ltd on Tuesday, but is a discount of 1.85 percent to the PSE closing price of P17.32 per share.

Del Monte Pacific earlier set a maximum price of P22.84 per share. World markets, including the Philippines, have succumbed to heavy selloffs in recent days on worries over the outlook for global economic growth.

The offering will commence on Thursday and will run until October 22. The shares will be listed on the PSE on October 30.

Del Monte Pacific tapped BPI Capital Corp as the lead underwriter for the offering.

Net proceeds of P79.95 million will be used to partially repay short-term debt used for the acquisition of the company that owns the Del Monte brand rights in the United States and South America.

Del Monte Pacific lost $21.9 million in the May to July period, which corresponds to the first quarter of the fiscal year of Del Monte Foods Inc (DMFI), due to higher interest expense from a long-term credit used to acquire DMFI and a short-term bridge loan.

The Philippine firm completed the acquisition of DMFI for $1.68 billion in February, giving it a presence in the world's biggest market.

- Interaksyon

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