MANILA, Philippines – Listed Alliance Select Foods International Inc. is raising its authorized capital to P1.5 billion from P950 million in preparation for future capital-raising activities.
The new capitalization consists of 1.5 billion shares with a par value of P1. Of the P550 million capital hike, P137.5 million has been subscribed and paid by way of stock dividend out of the corporation’s retained earnings as of end-December 2010.
Alliance Select said the increase in capitalization and stock dividend are still subject for approval in the company’s annual stockholders’ meeting on Aug. 1.
The company is raising P272 million from a stock rights offering involving 272.27 million shares priced at P1 apiece. The offer price is equivalent to a 33.25-percent discount to the volume-weighted average price of Alliance Select’s common shares for the 15-day trading period ending June 8.
Each eligible shareholder can buy one share for every 2.2 common shares held as of June 29. The rights offering will run from July 4 to 13, while the listing of the shares has been tentatively scheduled on July 25.
Proceeds form the offering will be used to fund the acquisition of Massachusetts-based salmon smoking firm Spence & Co., as well as pay down short-term obligations to Amalgamated Investment Bancorp. and support working capital requirements.
Abacus Capital & Investment Corp. is the issue manager and underwriter for the rights issue.
Spence was formed in 1990 and has established itself as a leading processor of premium quality smoked seafood. The company’s products are available in the leading supermarket chains across the US. These projects are marketed under the Spence brand as well as the house brands of these supermarkets.
Alliance Select’s third smoked salmon venture will help it establish presence in the lucrative seafood market in the US.
The company is engaged in tuna processing, canning and exporting of canned tuna products, with facilities in Gen. Santos City in Mindanao and in Bitung, in the island of North Sulawesi, Indonesia. It exports to Europe, North America, Asia, Africa and South America, and is a “private label manufacturer” of canned tuna and processes and tuna cans using its customers’ brands.
It also processes the by-products and scraps from its tuna processing operations into fishmeal, which it sells to Philippine and foreign feed millers.
Alliance Select has set up a marketing representative office in Bangkok, Thailand to tap the network of buyers and brokers who use Thailand as a base to buy canned tuna.
The firm also has a 40-percent stake in FDCP Inc., a can-making company, which ensures the availability of quality cans at competitive prices and sustainable supply.