Six years after breaking into the American market and reuniting with its mother brand at the expense of an enlarged debt, Campos family-led Del Monte Pacific Ltd. (DMPL) completed the recapitalization of its American consumer arm.
US-based Del Monte Foods Inc. (DMFI) raised $1.3 billion in fresh financing through a mix of equity and new debt, thereby strengthening its balance sheet, dual-listed parent conglomerate DMPL disclosed to the Philippine and Singapore stock exchanges on Monday.DMFI raised $500 million from a five-year corporate note issue, another $450 million from an asset-based loan (ABL) and $378 million in fresh equity from DMPL. These funding deals had the net effect of reducing DMFI’s loan facilities to $950 million from $1.4 billion, the disclosure said.“This transaction is an important milestone for DMFI and the DMPL group,” DMPL managing director and chief executive officer Joselito Campos Jr. said. “In this new market environment, Del Monte has seen significantly increased demand for its healthy, shelf-stable products across all product lines. Today’s recapitalization and de-levering position the company to take full advantage of these new market opportunities.”
DMFI is a leading producer, distributor and marketer of premium quality, branded, plant-based food products for long shelf-life categories, primarily in the United States.
The notes, the ABL Facility, and the DMPL investment were used by DMFI to refinance its existing DMFI loan facilities of around $1.1 billion that were maturing later this year through 2021. DMPL had previously purchased $237 million worth of DMFI’s loans.
DMFI issued $500 million of 11.875-percent senior secured notes due 2025, with original issue discount equal to 3 percent of the principal amount. The notes were offered to qualified institutional buyers within the United States. —DORIS DUMLAO-ABADILLA INQ