SMC may use own funds or borrow to fund Exxon Mobil subsidiaries purchase

Diversified conglomerate San Miguel Corp. will be using internal funds or seek loan facilities to fund its acquisition of the downstream oil business of US-based oil giant Exxon Mobil in Malaysia. "To finance the acquisition, the company will utilize internally-sourced funds and, if necessary, draw on unused and existing credit facilities," said San Miguel in a statement to the Philippine Stock Exchange on Tuesday. San Miguel announced last week that it will be acquiring 65 percent of Esso Malaysia Bhd (EMB), and the entire ExxonMobil Malaysia Sdn Bhd (EMMSB), and Exxon Mobil Borneo Sdn Bhd (EMBSB) for $610 million. Following the acquisition of 65 percent of EMB, San Miguel said it is required under the Malaysian Code on Takeovers and Mergers 2010 to conduct a mandatory takeover offer to acquire the remaining voting shares of EMB, which is listed at the Malaysian Stock Exchange. The three subsidiaries are engaged in refining, distributing and marketing of petroleum products. Their physical assets include the Port Dickson refinery with a related capacity of 88,000 barrels a day; seven fuel distribution terminals; and a network of about 560 branded service stations, of which 420 are company-owned. Ramon S. Ang, San Miguel president and chief operating officer, said the acquisition provides San Miguel the opportunity to "expand" in the regional oil and gas sector. Through subsidiary Petron Corp., San Miguel is the largest oil refiner in the Philippines with a crude distillation capacity of 180,000 barrels per day. Petron operates a network of over 1,700 service stations in the Philippines. --CMA/OMG, GMA News