Conglomerate San Miguel Corp. said Thursday it is investing P3 billion in Petrogen Insurance Corp., a wholly-owned subsidiary of Petron Corp.
San Miguel said in a disclosure to the stock exchange its board of directors approved the P3-billion equity investments in Petrogen.
“With the investment, the corporation will have a direct equity interest in Petrogen in additional to its current indirect equity interest through Petron,” San Miguel said.
“The additional investments by the corporation in Petrogen will enable it to expand its instance business,” the conglomerate said.
Petrogen is duly licensed and authorized to conduct insurance business by the Insurance Commission. It is engaged in the business and operation of all kinds of insurance and reinsurance for sea and land; for properties, goods and merchandise; for transportation or conveyance; and against fire, earthquake, marine perils, and accidents, except life insurance.
Petrogen reported a net income of P79.1 million in 2019, down 2 percent from P80.5 million it reported in 2018.
Gross premiums written amounted to P724.8 million in 2019, up 20 percent from P600.8 million a year earlier.
After successfully raising P20 billion from the issuance of preferred shares in October, San Miguel plans to raise another P20 billion from the second tranche of preferred shares offering.
San Miguel is offering 133.333 million Series 2-K preferred shares with an oversubscription option for another 133.33 million preferred shares with an initial dividend rate of 4.5 percent per annum
The shares will be sold at P75 each.
The net proceeds from the fund-raising activity will used to repay fully or partially existing obligation, fund additional investments in the airport and airport-related projects and in Bank of Commerce.
The share price of San Miguel rose 1.58 percent Thursday to close at P134.90, while the stock price of Petron added P0.040 to settle at P4.01.