San Miguel to wrap up Pure Foods sale in 30 days

San Miguel Corp. expects to sell a 49-percent stake in its food unit next month as part of a strategy to diversify, according to its top executive. “The Pure Foods deal should happen in 30 days," San Miguel president Ramon S. Ang told reporters. In case Pure Foods remains unsold after June, San Miguel would go for a secondary share offering of its food unit, Ang said. The diversified conglomerate, whose exposure spans food and beverage and power generation, is in talks with five companies — down from eight — regarding the San Miguel Pure Foods deal. Pure Foods is in the business of dairy production, poultry and livestock, animal feeds, and processed meat, and has an equity value of about $1 billion. The food unit’s profits grew sixfold in the first quarter to P872 million. It is looking at a 15-percent profit growth for the year. Parent San Miguel is building its war chest as it continues to diversify into heavy industries, particularly in power distribution and generation. Proceeds from the sale of Pure Foods shares would help finance San Miguel’s plans to diversify. The company owns 27 percent of Manila Electric Co. The conglomerate started selling key businesses in 2007, including its 65-percent stake in the Philippine unit of Coca-Cola Co. for $590 million, and its 43.3-percent stake in San Miguel Brewery to Japanese brewer Kirin Holdings Co. Ltd. for $1.3 billion. The whole Pure Foods deal is all about the price, according to Justino B. Calaycay Jr., an analyst with Accord Capital Equities Inc. “You are putting on the block a viable company. It will attract a lot of interest from the buyers. It is just really a matter of pricing."