MANILA -- San Miguel's food and beverage unit will issue shares to remain listed on the Philippine Stock Exchange, officials said on Thursday, after a consolidation resulted in a breach of the minimum free-float rule.
Shareholders of San Miguel Pure Foods approved its merger with San Miguel Brewery and Ginebra San Miguel in a 336.35 billion pesos ($6.64 billion) share-swap transaction undertaken by their parent San Miguel, the nation's largest company by sales.
The move will increase San Miguel's ownership in Pure Foods to 95.5% from around 85.4%.
Pure Foods President Francisco Alejo said his company would conduct a "follow-on offering to meet the minimum public float requirement of at least 15%."
Officials declined to disclose the size of the share sale, although San Miguel President and Chief Operating Officer Ramon Ang previously said the company might bring Pure Foods' public float to 35% by raising $3 billion, valuing the company at around $10 billion.
The share sale is planned for the second quarter, San Miguel Chief Financial Officer Ferdinand Constantino said.
The sale could give San Miguel fresh capital as it prepares to refocus on its food and beverage businesses after years of aggressive expansion in power and transport infrastructure.
San Miguel Pure Foods will be renamed San Miguel Food and Beverage, pending approval from the securities regulator.
In 2016, San Miguel Pure Foods posted annual sales of 111.59 billion pesos and net income of 5.98 billion pesos. Including San Miguel Brewery and Ginebra, the new entity -- San Miguel Food and Beverage -- will have combined annual sales of 227.3 billion pesos and net income of around 24 billion pesos, becoming one of the biggest food and beverage companies in the region, according to data compiled by Nikkei Asian Review.
Shares of San Miguel Pure Foods fell 0.7% to 537.00 pesos on Thursday, while those of its parent San Miguel gained 0.8% to close at 131.50 pesos. Manila's benchmark index, meanwhile, slightly dropped 0.3% to 8820.74.