SEC En Banc rejects Ginebra shareholder’s appeal to void SMC’s P334B food business merger in 2018

The Securities and Exchange Commission En Banc has thumbed down the appeal of Josefina Multi-Ventures to block San Miguel Corp.’s P334 billion consolidation of its food business units in 2018.

SMC said the SEC En Banc ruled in its favor by affirming the SEC Special Hearing Panel’s 2019 decision which denied Josefina’s case seeking to nullify the shares swap which led to the merger of San Miguel Pure Foods, Inc., San Miguel Brewery, Inc. (SMB), and Ginebra San Miguel Inc. under San Miguel Food and Beverage, Inc. (SMFB).

SMFB’s external lawyer, Picazo Buyco Tan Fider & Santos, received a copy of the SEC En Banc decision on September 14, 2020.

Josefina, a minority shareholder of Ginebra, claimed that SMC should have conducted a tender offer after it bought 75 percent of SMFB based on SEC rules that compel individuals or groups buying more than 35 percent of a company to extend the same buyout offer to other shareholders.

The SEC ruled that Josefina’s case has no basis because the mergers or consolidations just like the SMC deal was not covered by the tender offer rule since there was no change in ownership, merely a shift in classification from indirect to direct.

SMC increased its stake in SMFB to 95.87 percent from 85.37 percent after the merger.

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