MANILA, Philippines - San Miguel Brewery Inc. (SMB), the flagship unit of diversified conglomerate San Miguel Corp. (SMC), is looking at investing around $300 million for three new breweries in Southeast Asia.
The expansion plan is being studied as the company is looking at delisting its stocks in the local bourse if its Japanese partner refuses to sell a portion of its holdings in the brewery, SMB’s top official said yesterday.
“We are looking at building a brewery in Cambodia, Myanmar and Laos. Each plant (will require) a minimum investment of $100 million,” SMB chairman Ramon S. Ang said.
Each plant will result in additional revenues of $200 to $300 million per year, Ang said, adding that output of the new breweries will be sold to the host country.
SMB has existing breweries in Indonesia, Thailand, Vietnam, northern and southern China and Hong Kong.
Ang said the expansion plan, which will focus on Southeast Asia, is under study while SMB will tap South Sudan for exports.
For this year, SMB is looking at better operations through low-cost products that will bring more profitability.
Ang said profits and revenues are expected to grow double digits. Sales reached P71.91 billion last year, up 6.4 percent while net income rose 17.4 percent to P12.18 billion.
For its public float, Ang said he will visit Tokyo this week to talk to officials of Japan’s largest beer company, Kirin Brewery Co.
“If Kirin does not agree to sell shares, we will go for delisting,” Ang said.
Kirin owns around 48 percent of SMB, parent firm SMC owns roughly 51 percent, with the rest owned by the public.
Ang said SMC wants to retain control of SMB, hence the conglomerate will not sell any of its stake to comply with the 10-percent public float requirement of the Philippine Stock Exchange.
“We do not want to sell our beer business although it is sometimes very tempting,” Ang said.
Delisting will be conducted as soon as possible if the local bourse also refuses to extend the grace period for SMB to comply with the public float rule, Ang said.
SMB is the company behind beer brands like San Miguel Pale Pilsen, Red Horse, San Mig Light and Gold Eagle.
Meanwhile, Ang said SMC is pursuing its expansion plans for flag carrier Philippine Airlines (PAL), starting with the acquisition of two Boeing 777s that will arrive in June. The planes will be used to increase flights in the Southeast Asian region.
Asked if SMC wants to buy a majority stake in PAL, Ang said: “Sa PAL, kung ano gusto ni Lucio Tan yun ang masusunod.”
Early this month, SMC bought a 49-percent stake in PAL for about $500 million. The conglomerate also gained management control of the airline.