To fund Del Monte rights subscription NutriAsia borrowing $100 M

MANILA, Philippines - NutriAsia Pacific Ltd. of the Campos family is borrowing $100 million from a local bank to finance its planned subscription to a stock rights offering of food processing giant Del Monte Pacific Ltd. (DMPL).

In a disclosure to the Philippine Stock Exchange, DMPL said NutriAsia had entered into a term loan agreement with the Bank of the Philippine Islands for up to $100 million.

NutriAsia, a controlling shareholder of DMPL, entered into a share charge agreement under which a first ranking charge will be constituted in favor of the Hongkong and Shanghai Banking Corp. Ltd. as security agent over the Campos family’s ordinary shares in DMPL.

The loan will have a collateral value of not less than 200 percent of the loan amount and dividends accruing from the shares equivalent to an agreed percentage of the loan amount

 “NutriAsia will be required to provide additional security as necessary to maintain the 200 percent collateral value. The loan will be drawn down when NutriAsia submits the relevant subscription application form under the rights issue and the share charge will only be created then,” DMPL said.

NutriAsia expects the share charge to cover 849,995,026 of its ordinary shares in the company which constitute about 65.28 percent of the company’s issued share capital before the rights issue and about 43.72 percent of the company’s enlarged share capital after the rights issue,” it added.

DMPL intends to raise $154.4 million from a stock rights offering of 641.30 million new ordinary shares that will be simultaneously conducted in the Philippines and Singapore.

Offer period for the shares will run from Feb. 10 to Feb. 26, with its listing in both the Philippine Stock Exchange and the Singapore Exchange Securities Trading Ltd. set on March 9.

The NutriAsia Group is one of the first local companies to go global, offering popular brands such as Datu Puti, UFC, Mang Tomas, Jufran and Papa, Golden Fiesta and Hapi Fiesta for products such as vinegar, soy sauce, spaghetti and lechon sauces, cooking oil, banana catsup, among others.