MPIC eyes market pole position for Axelum

INQUIRER FILE PHOTO

Metro Pacific Investments Corp. (MPIC) is poised to complete a P5.3-billion investment in Axelum Resources Corp. by the second quarter of the year amid plans to turn the company into a “world-class market leader in the coconut and food space.”

The parties were currently in the process of completing a series of regulatory steps, including notifying the Philippine Competition Commission of the acquisition.

Once completed, the deal would give Metro Pacific subsidiary, Metro Pacific Agro Ventures Inc., a sizeable minority stake of 34.76 percent in the coconut exports and processing firm.

“[Metro Pacific] has the financial capability and international access to help the company develop markets or acquire businesses in the same general space as it is currently operating,” Axelum said in a detailed transaction disclosure to the Philippine Stock Exchange.

Major player

Metro Pacific is a unit of Hong Kong-based First Pacific Group, which owns PT Indofood Sukses Makmur, one of the largest food companies in Indonesia.

Its infrastructure portfolio includes some of the Philippines’ biggest utilities such as Manila Electric Co. and Maynilad Water Services Inc. It also operates toll roads, railways, hospitals and logistics companies.

According to Axelum, Metro Pacific plans to expand its production and exports businesses.

These include investments in a “new coconut water line filling machine” that is estimated to increase production capacity by up to 4 million liters in two to three years.

“We think that Metro Pacific’s entry into agriculture is good with a major conglomerate now [with] Axelum. Food security and the capability to increase agricultural output is a key issue to tackle right now for the country,” Gabryle Aguila, head of equity research at stock brokerage house Unicapital Securities Inc., told the Inquirer.

Once the deal is complete, Metro Pacific will be allowed to nominate one director on the Axelum board and assign a finance executive in management. It will get two board seats after Axelum gets approval to increase its board seats from seven to nine.

Axelum, whose main factory is located in Misamis Oriental, Mindanao, is a fully integrated manufacturer of high-quality coconut products for domestic and international food and beverage companies.

The company uses all the parts of the coconut to make coconut water, desiccated coconuts, coconut milk powder, coconut milk/cream, reduced fat coconut, sweetened coconut and coconut oil.

It is also one of the major suppliers of Vita Coco, the global market leader in coconut water.