San Miguel Brewery Shares Surge in Manila on Speculation of Property Sale

11/17/2010 - San Miguel Brewery Inc., which makes more than 90 percent of beer in the Philippines, gained the most in 22 months in Manila trading on speculation it will develop or sell some of its property assets.

San Miguel Brewery climbed 11 percent to 14 pesos at the midday close of trading on the Philippine Stock Exchange. That’s the biggest gain since January 2009 and the highest level since the stock’s 2008 initial public offering.

“I understand that there’s going to be revaluation of all its property,” said Nestor Aguila, president of DA Market Securities Inc. in Manila. “Whatever property the brewery has can be used for development. I understand there are counterparties offering for their properties.”

The brewer also climbed on speculation Tokyo-based Kirin Holdings Co. will increase its 48 percent stake in the company.

“Kirin is on a buying spree,” said Lawrence de Leon, an analyst at Accord Capital Equities Inc. “Increasing its holdings in San Miguel Brewery or furthering investments in the Philippine beverage market, through the brewery, is a possibility.”

Ramon Ang, president of parent company San Miguel Corp., denied the brewer plans to sell property and said he doesn’t know if Kirin intends to buy more shares. Kirin spokesman Jun Sato declined to comment on the Japanese company’s stake in San Miguel Brewery.

“There’s always a possibility” with Ramon Ang of a deal, said Ali Yu, president of Manila-based brokerage R.S. Lim & Co. “There could be a brewing deal.”

San Miguel Brewery this month said it bought San Miguel Corp.’s 40 percent stake in the company that owns the brewer’s production facilities and sales offices for 6.83 billion pesos ($156 million). In May, Ang said the brewer will work with Kirin to expand in Asia.

Kirin is expanding abroad as Japan’s population shrinks. The company has spent more than $8 billion on acquisitions in the past three years.(bloomberg.com)

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