Philippines' Emperador says Singapore's GIC to buy initial 9.64% stake

[MANILA] Philippine liquor firm Emperador Inc said on Friday it had agreed to sell a 9.64 per cent stake to GIC for 17.6 billion pesos (US$391 million), in what it described as an initial investment by the Singaporean sovereign wealth fund.

The world's biggest brandy maker - which bought world No. 5 scotch whisky maker Whyte & Mackay in May - said the deal would strengthen its capital position as it continues to look at other investments to expand its portfolio.

The deal comprises an equity investment of 12.32 billion pesos for 1.12 billion common shares equivalent to a 6.95 per cent direct equity stake in Emperador, while the rest of the purchase was via equity-linked securities worth 5.28 billion pesos.

The equity-linked securities have a term of up to 7 years and are convertible into 480 million common shares of Emperador.

GIC agreed to buy Emperador shares at 11 pesos per share, representing a 3.2 per cent premium over the stock's closing price on Thursday.

Shares in Emperador rose as much as 4.9 per cent in early trades on Friday after the deal announcement.

Emperador said GIC has an option to invest an additional 4.4 billion pesos in the company at 11 pesos per share over a 13-month period.

The option, if exercised, would raise GIC's stake in Emperador to 11.76 per cent, the Philippine company said.

UBS AG was Emperador's financial adviser for the transaction.

Emperador bought Whyte & Mackay from India's United Spirits Ltd for 430 million pounds (US$681 million).

REUTERS