SMC secures investment license for Vietnam proj

Food and beverage giant San Miguel Corp. (SMC) has obtained an investment license from the People’s Committee of Dong Nai Province in Vietnam, the company told the Philippine Stock Exchange.

SMC chairman and chief executive officer Eduardo Cojuangco Jr. said the investment license will allow the company to be part of Dong Nai’s economic growth and prosperity, which underscores SMC’s faith in Vietnam and its seriousness in investing in its future.

"Vietnam’s growth in the past few years and ability to deal with a difficult economic environment have been admirable. While most regional markets reeled from the Asian financial crisis, Vietnam stayed true to its course, "Cojuangco said.

Cojuangco also lauded the Vietnamese government’s focus, leadership and capability as the economy continued to register growth during the SARS outbreak, which dampened many Asian economies.

SMC’s presence in Vietnam goes back as early as 1996 when its brewery San Miguel Brewery Vietnam Ltd. in Nha Trang began operations. That same year, San Miguel Phu Tho Packaging Co. started making metal closures and caps while San Miguel Yamamura Haiphong Glass Co. began producing and marketing glass containers.

Recently, SMC completed its purchase of TTC Vietnam Ltd., a company with hog farm and feed milling operations in Binh Duong.

SMC also recently signed an agreement with Thai real estate developer Amata City Co. Ltd. to acquire a $20-million industrial complex in Rayong, Thailand – one of the most vibrant industrial estates in Thailand.

The purchase of the 100-hectare industrial site in Rayong is part of SMC’s efforts to fortify its presence in the Asia-Pacific region. Thailand is one of the seven countries earlier identified by the company as an ideal expansion site.

SMC’s expansion in Thailand involves the manufacturing of various products from beverage, processed food to feeds. The plant is expected to be operational in 2005.

Aside from Thailand and Vietnam, SMC is also looking at China, Indonesia, Australia, Malaysia and Taiwan for its regional expansion. The company is expected to sign agreements soon to establish food and beverage complexes in these areas.

SMC expects its annual group revenues to increase by $300 million from sales generated in these markets.

SMC has earmarked up to $700 million for planned acquisitions and investments in Asia, aimed at seeking offshore growth to complement its dominant foothold in the local beverage market.

SMC said its increased presence in these Asian markets will allow it to keep posting double-digit sales growth even as economic activity in the Philippines remains sluggish.

Cojuangco earlier said SMC was likely to meet its P7-billion net profit target for 2003, up from P6.63 billion in 2002, when the company booked a one-time restructuring cost of P837 million.