Del Monte Pacific to raise up to $774m in private placement to cut debt

The equity raise will be executed through Del Monte Philippines Inc.

Del Monte Pacific could raise $645–774m (US$500–600m) through a share placement to reduce debt and address a capital deficit following the deconsolidation of its U.S. operations.

The equity raise would be executed through its unit, Del Monte Philippines Inc (DMPI).

The management confirmed that while the equity raise will dilute shares, the group will maintain controlling interest.

The move targets a lower Debt-to-EBITDA ratio, from 7x to an expected 4–5x, and is part of broader efforts to address the capital deficit caused by impairments from the U.S. business.

The move comes after the U.S. Group filed for Chapter 11 bankruptcy. According to Del Monte’s CFO, inflation in 2022–2023 added US$200–250 million in costs, including US$100 million from metal packaging alone, whilst interest rates and import duties further strained liquidity. These pressures, combined with declining post-COVID sales categories and intense competition from private labels, led the Board to deconsolidate the U.S. operations.

The PSE temporarily suspended DMPI shares in September due to an audit disclaimer from Ernst & Young over U.S. asset valuations; trading resumed after clarifications.

The private placement is expected to reduce leverage, lower financing costs (currently around 7%), and strengthen overall shareholder value. IPO options are not considered viable at this time.