SM Investments takes full ownership of 2 grocery chains

BY PATRICIA DE LEON, GMANews.TV SM Investments Corp said Thursday it was taking over SM Supermarkets and SM Hypermarkets worth a combined P13 billion, through a shares-swap transaction with minor investors, to have direct access to profits of the popular chains. SM Investments, a conglomerate controlled by taipan Henry Sy Sr., controls mall developer SM Prime Holdings Inc., Banco de Oro, Equitable PCI, SM Development Corp., and Highlands Prime. SM Investments said it issued 56 million new shares of the company to the Fong family to raise its stakes in SM Supermarkets and Super Shopping Markets to 100 percent. SM Investments investor relations head Corazon Guidote said the two chains were owned by the Sy family, the Fong group, and other minority shareholders. She did not provide the ownership structure. "Before the acquisition, we could not consolidate the assets," Guidote said. SM Supermarkets, which carry 70-80 percent food merchandise, has 28 branches nationwide. SM Hypermarkets, which has a balanced combination between food merchandise and non-food items, have nine branches. "We welcome the infusion of the supermarket and hypermarket business into SM. They are vital components of our retail merchandising portfolio, which will practically double the sector's revenue base and further enhance its growth potential. Consequently, they will also enhance the shareholder value of SM as the holding company," SM president Harley Sy said. The firm said that with the addition of the supermarkets and hypermarkets in their business, retail merchandising will now account for over 80 percent of SM Investment's revenues and 30 percent of its net income. For the first nine months of the year, the combined net income of the supermarkets and hypermarkets amounted to P1.1 billion, or 51.5 percent of SM's total retail income. Department stores contributed 48.5 percent of retail profit at P1 billion for the period.- GMANews.TV