Del Monte PH rolls out P7.5B bond offer

Del Monte Philippines’ food and beverage products

Food and beverage producer Del Monte Philippines Inc. is raising as much as P7.5 billion from a new bond offering, lowering its borrowing cost and lengthening debt maturities by using the proceeds to repay costlier short-term debt.

DMPI is offering three-year bonds at 3.4840 percent per annum and five-year bonds at 3.7563 percent per annum, based on the company’s disclosure to the Philippine Stock Exchange.

The company has obtained approval from the Securities and Exchange Commission to launch the offering.

The offering started on Oct. 20 and will run until Oct. 26 this year. The base offer is P5 billion with an oversubscription option of P2.5 billion.

Minimum investment is P50,000 while increments will be in multiples of P50,000.

BDO Capital, China Bank Capital, First Metro Investment Corp. and RCBC Capital Corp. are the joint issue managers, joint lead underwriters and joint bookrunners for the offering.

Based on DMPI’s prospectus, proceeds will be used to pay short-term and unsecured debt. In particular, DMPI owes P6.3 billion to Bank of the Philippine Islands through a short-term facility carrying interest rates of 4 to 4.25 percent per annum. It owes another P1.1 billion to Mizuho Bank Ltd. at same rate of 4 to 4.25 percent per annum.

DMPI is part of Campos-led Del Monte Pacific Ltd. (DMPL) Group, one of the world’s largest and most well-known producers and marketers of premium quality food and beverage products. DMPL is dually listed on the Singapore and Philippine stock markets.

DMPI has been in operation in the Philippines for 94 years and is the market leader in a number of categories, such as, canned pineapples and canned mixed fruits, ready-to-drink juices (excluding doy/foil packs) and tomato sauce and spaghetti sauce.