Del Monte buying over US namesake business

TWO Singapore listed food players yesterday announced separate corporate deals as they seek to expand their global footprints.

Mainboard-listed plantation company Del Monte Pacific is selling some stakes to boost its war-chest to fund its purchase of a US food company of the same name, while another Singapore-listed food player, SunMoon Food Company, is buying into a US-based beverage maker.

Del Monte Pacific announced it had entered into a subscription deal with Ace Profit Enterprise and Anatoli Holdings, both of whom have agreed to invest US$37.25 million each for a "minority stake" in it.

This will add to the US$515 million in financing Del Monte Pacific has obtained from Banco de Oro Unibank and Bank of the Philippine Islands to help fund its buyout of the consumer food business of US corporation Del Monte Foods for US$1.675 billion.

The two Del Monte companies are not affiliated, but they share the same name because the Del Monte brand's trademark was bought, split and sold to various companies in different territories years ago.

Ace and Anatoli are investment vehicles owned by independent third-party investors.

"The directors (of Del Monte Pacific) consider the investors as strategic investors since they are expected to provide linkages between their business networks in Asian markets and the consumer food business," Del Monte Pacific said.

Separately, SunMoon Food Company said it has signed an agreement to acquire 62,500 stocks in Nevada-incorporated True Drinks Holding Inc at US$4 per stock, amounting to US$250,000 in all.

The 62,500 shares are series B preferred stocks which are convertible to common stocks - at 16 common stocks for each preferred stock held.

Up to one million common stocks can be converted, representing 1.31 per cent of True Drink's total share capital.

The 62,500 preferred stocks also carry the option for SunMoon to receive five-year warrants to buy 291,667 common stocks at US$0.30 apiece, representing a 1.49 per cent stake.

True Drinks sells beverages for children and has a distribution network of 22,000 stores in the US. It also has licensing agreements with major entertainment and media companies for use of its characters on its proprietary, patented bottles.

SunMoon said it plans to explore collaboration with True Drinks' AquaBall™, a vitamin-enhanced water created as a zero-calorie, sugar-free alternative to juice and soft-drink for kids, as well as SunMoon processed fruit products, which have already been launched in Indonesia with more than 8,000 points of sales.

The transaction, funded through internal resources, is not expected to materially impact its consolidated net tangible assets and earnings per share for the current fiscal year, it said.