Pepsi Cola Products Philippines lnc. on Thursday said South Korea’s Lotte Chilsung Beverage Co. Ltd. will reopen its tender offer to buy the remaining shares of the bottler after regulators granted its request for exemptive relief.
Lotte has asked for exemptive relief from the Securities and Exchange Commission and the Philippine Stock Exchange and said it has no plans to de-list Pepsi-Cola from the local bourse.
The Korean company also said it has no plans that would result in any merger, reorganization or liquidation of the company, or that would result in a material change to the company’s corporate structure or business.
As a condition, the SEC has asked Lotte to have its tender offer open until ten (10) days from the disclosure of the Philippine Competition Commission decision on the transaction.
“The Bidder, through PCPPI, shall disclose to the Philippine Stock Exchange (“PSE”) and SEC the decision of the PCC immediately upon receipt thereof,” the order said.
“Lotte Chilsung shall permit the securities tendered to be withdrawn at any time during the period such tender period remains open.”
Lotte Chilsung., a subsidiary of Lotte Corp., is offering P1.95 for each tendered share. This tender offer price represents a 12.27 percent premium over the six-month volume weighted average price and a 6.14 percent premium over the three-month VWAP of Pepsi-Cola’s common shares. This price is also above the current trading price of the company’s shares, which was last traded at P1.85.
Lotte Chilsung, the owner of brand such as Milkis aside from other popular Pepsi-Cola brands, is buying some 2.13 billion common shares of the local bottling firm or about 57.78 percent.
The deal is worth about P4.15 billion.
Lotte Corp. already owns at least 38.88 percent of Pepsi-Cola.
Pepsi-Cola’s suffered a net loss for the third quarter of 2019 ending September of P65.95 million, deeper than last year’s loss of P32.55 million. For the nine months of the year, however, it still reported a net income of P380.1 million, a turnaround from last year’s loss of P81.19 million.
The company also formalized the halting of its local manufacture of Cheetos snack franchise.