SAN MIGUEL CORP., which has been aggressively expanding into industries outside of its core food and beverage businesses, is pursuing an offering of $1 billion in convertible preferred shares in 2009 despite an expected slowdown in the global economy, its top official told the Inquirer.

"Banks are just waiting for the timing," San Miguel vice chair and president Ramon S. Ang said.

Ang expressed confidence that San Miguel's "good name" could tide it over the bearish capital markets.

Ang said San Miguel was aiming at raising $1 billion from the local market.

San Miguel's plan will be a big boost for the capital market, which is bracing for tough economic conditions next year.

"It really boils down to the price. Even if the markets are down, if the buyer thinks the price is reasonable, then why not," a local analyst said.

Late in November, San Miguel said it was studying how to tap the local and international markets for its financing needs, including the type of currency and specific markets.

Ang earlier told the Inquirer that San Miguel was considering tapping both international and local markets to possibly offer preferred shares to raise around $2 billion for its aggressive expansion bid. Of the total funds targeted to be raised, $1 billion may be raised from the local market.

The plan arose after the beer giant received interests from Japanese, Singaporean and Western firms, sources added.

Proceeds from the sale of preferred shares will be used for San Miguel's investments in energy, mining and other utilities.

The preferred shares will carry market interest rates of between 8 and 10 percent a year, sources said.

Management is also reported to be looking into additional convertibility and optional redemption features for the preferred shares issue.

San Miguel has been scouting for value assets and hard-to-pass-off bargains given the impact of the global financial crisis. In its shopping cart are Petron Corp., Manila Electric Co. and Indonesian coal miner PT Bumi Resources.

The company reported that as of Sept. 30, it has cash and cash equivalent of P99.31 billion or roughly $2 billion at current exchange rates.

San Miguel is keen on acquiring at least 51 percent of PT Bumi over the long term.

Through various subsidiaries, PT Bumi owns the world's biggest coal mine for exports, with operations in East and South Kalimantan. It has 11 billion tons of coal reserves. Its sales volume was about 55 million tons a year.

San Miguel is also pursuing an agreement with British investment fund Ashmore Group to buy up to 50.1 percent in Petron.