Tanduay set to broaden share float available to public

MANILA, Philippines – The Lucio Tan-led alcoholic beverage manufacturer Tanduay Holdings has set an equity sale this December to widen its public ownership by about 10 percentage points and raise at least P1.8 billion in fresh funds for expansion.

In a disclosure to the Philippine Stock Exchange on Thursday, Tanduay said it had agreed with its majority shareholder, Tangent Holdings, on an equity place-out scheme in which Tangent would offer secondary shares through a public offering. Tangent will use the proceeds to buy exactly the same amount of new shares from Tanduay at exactly the same price as the prior subscription, less the expenses.

This top-up offering is similar to the scheme taken by many other publicly listed companies wishing to take a faster route to the widening of public ownership, avoiding the tedious registration process if new shares were to be offered directly to the public.

About 398 million new shares will be placed out to the public under this exercise, Tanduay president Wilson Young said in an interview.

Based on the disclosure, Tanduay’s public ownership will increase to 12.63 percent from 2.93 percent after the transaction while Tangent’s stake will go down to 87.37 percent from 97.07 percent.

Apart from raising fresh funds, this transaction will allow Tanduay to comply with the 10 percent minimum public ownership required for continued listing on the Philippine Stock Exchange.

The share sale will be priced on December 1, during which trading on Tanduay shares will be suspended, the disclosure said. The offering period will run from December 5-9.

The disclosure said the amount to be raised would be utilized for the expansion of the facilities of wholly owned Tanduay Distillers and the latter’s subsidiaries Absolut Distillers Inc. and Asian Alcohol Corp. and the improvement of the operational efficiencies at an estimated cost of P1.8 billion.