San Miguel hikes Petron stake to 68%

MANILA, Philippines - Diversifying conglomerate San Miguel Corp. (SMC) said yesterday it has increased its stake in Petron Corp., the country’s largest oil refiner, to a controlling 68 percent.

In a disclosure to the Philippine Stock Exchange, the food and beverage giant said it has exercised the option to acquire 60 percent of the outstanding shares of Sea Refinery Corp. (SRC) as provided in the option agreement dated Dec. 24, 2008.”

“With the exercise of such option, the company beneficially owns 68 percent of the outstanding and issued shares of stock of Petron,” he said.

SRC controls 50.1 percent of Petron’s outstanding common shares. The company is a unit of British investment firm Ashmore Group’s SEA Refinery Holdings B.V. (SEA BV), which owns another 40.5 percent of Petron.

SMC earlier inked a deal with the Ashmore Group for the right to acquire 40 percent of SRC before April 30 and the rest of the company by Dec. 23.

Once it completes the takeover of SRC, SMC would gain majority of Petron’s shares after which it may also target SEA BV’s shares in the oil company.

“Upon completion of the tender offer, [San Miguel] may enter into an agreement with SEA BV in respect of their respective ownership of shares in Petron,” SMC said.

At present, SMC holds 38 percent of Petron’s listed shares after its partial acquisition of SRC and the completion of its mandatory tender offer to the oil firm’s minority shareholders.

SMC acquired less than two percent of Petron through the tender offer at a price of P6.85 per share, which had a premium of about 14 percent of the oil firm’s market price when it was announced in April.