San Miguel Corp. presents. 97 billion pesos ($1.6 billion) to acquire Eagle Cement Corp. Billionaire Ramon Ang – the controlling shareholder in both companies – seeks to advance his business interests amid the construction boom in the Philippines.

Under the proposed deal, approved by San Miguel’s board of directors on Tuesday, San Miguel is offering to buy 88.5%, or about 4.4 billion shares of Eagle Cement, for 22.05 pesos each, the country’s largest conglomerate by assets said in a regulatory filing at the time. late. yesterday. Ang – President and CEO of San Miguel, and concurrently President of Eagle Cement – did not participate in the deliberations of the San Miguel Board of Directors.

San Miguel is offering to buy Eagle Cement at a premium of 43% from yesterday’s closing price of 15.40 pesos per share as the Philippines ramps up building infrastructure projects across the archipelago. Last month, the government awarded several contracts to begin construction of a 36-kilometer subway connecting the main gateway to the country’s Ninoy Aquino International Airport to Quezon City, north of the capital, Manila. San Miguel itself is promoting investments in infrastructure projects, including the massive international airport project, toll roads, and power plants.

The acquisition comes amid a strong earnings recovery for Eagle Cement, as its net profit jumped 77% to 6 billion pesos in 2021 from the previous year, topping pre-pandemic levels. Sales increased 54% to 21.4 billion pesos in the same period as the company strengthened its ability to meet rising demand. Shares of Eagle Cement jumped 30% to 20 pesos a piece in morning trading on the Philippine Stock Exchange. San Miguel shares rose 0.3 percent to 96.95 pesos each.

โ€œReflecting the recovery of the Philippine economy, demand for our products has been strong in all of our regional markets,โ€ Ang said in Eagle Cement’s latest annual report. Improvements in the economic background and increased construction activity, combined with our management team’s focus on execution, enabled Eagle Cement to end 2021 in sound financial shape. Our strong financial results will allow us to invest in areas needed to grow or improve our assets and continue to explore strategic opportunities that will expand our geographical product range and product portfolio.โ€

Ang โ€” who acquired most of his shares in San Miguel from the late businessman Eduardo Cojuangco Jr. in 2012 โ€” has transformed the company from a brewery and food factory into one of the country’s most diversified conglomerates with interests in real estate, oil refining, power generation and infrastructure. With a net worth of $2.45 billion, Ang ranks 9th in the list of the Philippines’ richest people published in August.