SINGAPORE-BASED Golden Springs Group (GSG) has agreed to sell 75 percent of its ownership of Gold Coin Management Holdings Ltd. (Gold Coin) for $550 million (P29.34 billion) to Pilmico International Pte. Ltd. (Pilmico), a subsidiary of Aboitiz Equity Ventures Inc. (AEV).
The agreement is believed to be the biggest cross-border merger and acquisition (M&A) transaction in animal feed space in Southeast Asia.
The sale and purchase deal will see the start of a long-term partnership between the two conglomerates in Southeast Asia. Such integration of their subordinate companies is also seen to generate substantial synergies for both parties.
“The Zuellig and Aboitiz families have known each other for generations. I am excited about the partnership with Aboitiz Group, one of the largest and most established conglomerates in the region. The partnership will strengthen Gold Coin’s growth profile and long-term value creation potential,” said Peter Zuellig, GSG chairman.
Zuellig said the livestock-feed industry in Asia Pacific—underpinned by solid macroeconomic fundamentals—continues to grow and outpace global production.
With this in mind, he said they decided to retain a 25-percent stake in Gold Coin, with Credit Suisse acting as GSG’s sole financial advisor for this transaction.
“GSG has decided to continue to retain a minority stake to ensure we are able to participate in Gold Coin’s strong growth potential as it executes its expansion strategies together with Pilmico,” he said. “Gold Coin, as one of the leading animal nutrition platforms in Asia Pacific, is well-poised to capitalize on rising protein consumption.”
For AEV COO and Pilmico President and CEO Sabin M. Aboitiz, this alliance supports their initiative to expand their footprint in the region and bolster their output.
“Asean’s market size of 500 million will bring many opportunities to expand our customer base. This acquisition serves as a platform toward achieving Pilmico’s strategy to grow our core feed-milling business beyond Asean and now across Asia,” he noted.
“This acquisition will add 3 million metric tons of volume which quadruples our overall feeds production capacity,” he added.
AEV is the public holding company of the Aboitiz Group with major investments in power, banking and financial services, food, infrastructure and land.
Pilmico is the integrated agribusiness and food company of AEV. It is ranked among the top 3 flour and animal nutrition producers in the Philippines.
Founded by Peter Zuellig, GSG is an enterprise active in the agriculture and health-care sectors of emerging markets, with connection to over 50,000 customers who provide food and health-care products to people in more than 30 countries.
Its subsidiary, Gold Coin, offers scientifically balanced livestock feed. With geographically diverse operations across 11 countries, it is a well-recognized and respected brand in each of its markets, and is the only pure-play animal nutrition producer active in the majority of key livestock feed markets in Southeast Asia.
Established in 1953 in Singapore, Gold Coin is a pioneer in animal nutrition in the region with a proven operating track record that has seen it expand into an industry leader with more than 20 production mills.
“We look forward to working with Aboitiz and GSG to crystallize Gold Coin’s strategic vision,” said Gerald Wilflingseder, general manager of Gold Coin.