The Philippine unit of Del Monte Pacific Ltd said last week it plans to go public and raise up to $324 million this year, in what would be the country's largest food and beverage initial public offering (IPO) on record. Del Monte Philippines Inc's planned sale of a fifth of its shares would be the country's biggest IPO in 15 months and Southeast Asia's largest for a food and beverage firm in nearly six years.

The announcement comes as domestic demand for consumer goods remains strong despite the prospect of rising prices due to higher taxes on fuel. Del Monte Pacific said it sought for the Securities and Exchange Commission's approval of Del Monte Philippines' IPO, partly to pay existing loans. Del Monte Philippines will sell 559.46 million shares, or 20 percent of outstanding shares, at a maximum price of 29.88 pesos each, the company said in a disclosure to the Philippine and Singapore stock exchanges, where its parent is listed.

The majority of the IPO proceeds will be used to pay existing loans while remaining capital will be allotted for expansion. "The prepayment of such loans will allow the Del Monte Pacific Group to de-leverage and strengthen its balance sheet," the company said.

Del Monte Philippines hired BDO Capital & Investment Corp as the issue manager, sole global coordinator and sole bookrunner.

Copyright Reuters, 2018