SMC’s Ramon Ang eyes Picop?

Shares of Picop Resources Inc. have been steadily rising over the past week on persistent rumors that San Miguel Corp. president and chief operating officer Ramon Ang is buying into Southeast Asia’s largest paper mill company, analysts said.

Picop has been the subject of takeover rumors in recent days, with its share price almost doubling in just one week.  From only 35 centavos on July 9, the company’s stock jumped to as much as 75 centavos yesterday before closing at 69 centavos each share.

A total of 679.66 million shares of Picop changed hands yesterday valued at P470.62 million.

The market is rife with speculations that Picop is the target for a backdoor listing of the San Miguel Group for its planned mining ventures, or purely as a personal investment of Ang, a trusted associate of San Miguel chairman Eduardo Cojuangco Jr. 

A San Miguel official, however, denied this report.

Ang, who used to be a member of the board of directors of Picop, is known as a dealmaker of sorts having tried to bid for a  multi-billion dollar 25-year license to run the country’s national power grid in partnership with two other local businessmen. The auction failed and fresh bidding is expected later this year San Miguel is seeking new growth engines by investing in non-allied ventures such as mining, power, infrastructure after dominating its home base for beer, liquor, dairy, poultry and processed food.

The Department of Environment and Natural Resources earlier said San Miguel has applied for rights to explore for gold and other metals in Mindoro Island.

Organized in 1890, San Miguel has struggled to sustain double-digit growth in its homefront in the face of a highly-competitive market.

San Miguel is spinning off its local beer business ‑ its bread and butter-in preparation for its listing within the year.

San Miguel earlier said it would raise its capitalization to 7.5 billion shares, equivalent to about P37.5 billion, from the present 4.5 billion shares, to raise funds for its new ventures, pay down debt and finance a possible share buyback.

Formerly known as the Paper Industries Corporation of the Philippines, the company changed its corporate name to Picop on Feb. 14, 1995. The company was privatized in March 1994 through a public bidding that covered 183.1 million shares representing 90 percent of the government’s stakes. At present, Picop is under the control of TP Holdings Inc.

Picop is a multi-billion peso wood-based industrial complex operating one of the largest fully integrated timber, pulp and paper mills in Southeast Asia. It is widely recognized for the quality of its timber products such as plywood, veneer and lumber, and its paper products such as newsprint, kraft linerboard, corrugating medium, mechanical printing paper and world-class telephone directory paper.

Its forest concession covers about 200,000 hectares in Northeastern Mindanao under a sustainable and expanding yield basis.