MANILA, Philippines - A Singapore sovereign wealth fund is extending a P3.4 billion convertible loan to Century Canning Corp. (CCC), the parent of canned tuna manufacturer Century Pacific Food Inc.
In a disclosure to the stock exchange, Century Pacific said it has entered into an exchangeable loan agreement with Arran Investment Private Ltd, an affiliate of GIC Private Ltd. GIC is one of the world's largest fund management companies with assets under management of over $100 million.
"CCC will use the proceeds to finance growth and expansion of existing subsidiaries including but not limited to CNPF, possible acquisitions, possible entry into new businesses, and other general corporate purposes," Century Pacific said.
Arran will provide CCC with a P3.37 billion loan which carries an interest rate of 5 percent per annum. The agreement is for one year but extendable by both parties.
GIC will have the option to exchange the principal and accrued interest into 245.5 million issued and outstanding shares of Century Pacific at P13.75 per share. This is the same share price for Century Pacific's IPO.
If this option is exercised, then GIC will own around 11 percent of Century Pacific's issued and outstanding shares. These shares will be transferred from existing shares owned by CCC and will not lead to a dilution of shares of Century Pacific's public investors.
"We are pleased to have a world class investor such as GIC as one of our stakeholders. We look forward to a long term, value creating partnership with them. The financing provided by this transaction will allow us to support our various businesses, including Century Pacific Food, Inc, as well as take advantage of opportunities that arise from our fast growing economy," CCC president and chief executive Christopher Po said.
Last Tuesday, Century Pacific concluded the offer period for the IPO. The shares will be listed on May 6.
Century Pacific expects to raise P3.2 billion in gross proceeds from the IPO.