Singapore wealth fund GIC invests P17.6B in Emperador

Singaporean sovereign wealth fund GIC is buying into Emperador Inc., business tycoon Andrew Tan's liquor arm, for P17.6 billion as part of an expansion binge in the global arena.

 

In a disclosure to the Philippine Stock Exchange, Emperador said it signed a definitive purchase agreement with the private equity arm of GIC to invest P17.6 billion in equity and equity-linked securities of EMP at P11.00 per share.

 

The definitive agreement is expected to be completed this November, the firm said.

 

The company said the partnership will strengthen its capital position to further enhance the leading industry position of Emperador in the country and expand its business in both local and global markets.

 

"The partnership enhances AGI’s track record of growing companies into market leaders through strong execution, brand building and product innovation," Tan, the company chairman, said in a statement.

 

Under the agreement, GIC will initially invest P17.6 billion, comprising an equity investment of P12.32 billion for the purchase of 1.12 billion common shares, or 6.95 percent direct equity stake in Emperador. 

 

It will also include equity-linked securities of P5.28 billion, which has a term of up to seven years and convertible into 480 million common shares of EMP, which will raise GIC's stake in Emperador to 9.64 percent.

 

The Sigapore-based fund also has the option to invest another P4.4 billion in Emperador and raise its stake to 11.76 percent.

 

GIC will also have an option to invest an additional P4.4 billion in EMP at P11.00 per share over a 13-month period.

 

UBS AG acted as financial adviser of Emperador in the transaction.

 

Last week, Emperador, through wholly-owned subsidiary Emperador UK Limited, completed the full purchase of UK-based Scotch whiskey maker Whyte & Mackay Group Limited and its subsidiaries for P31 billion.

 

Whyte & Mackay holds one of the world's largest aged whisky inventories, with production capacity of 50 million liters of alcohol every year, with five distilleries and one bottling plant in Scotland.

 

Emperador has also been expanding its vineyard in Spain to meet its target of owning 2,000 hectares of grape-producing land by 2016.

 

Emperador is an integrated manufacturer, distributor and bottler of brandy and other alcoholic beverages, including the brands Emperador, Generoso, The BaR, Emperador Deluxe, and Emperador Light. – Danessa O. Rivera/VS, GMA News