SBS Philippines CorporationSBS

Completion of the acquisition of a warehouse facility complex comprising of land, buildings, improvements and machinery (the "Transaction") by the Company's subsidiary from The Coca Cola Export Corporation - Philippine Branch and its related parties

SBS Philippines Corporation (the "Corporation" or "SBS") thru its subsidiary, Lence Holdings Corporation ("LHC") completed the acquisition of warehouse facilities and property lot located at Silangan Industrial Park in Barangay Mapagong, Calamba City, Province of Laguna from The Coca Cola Export Corporation - Philippine Branch and its related parties on February 9, 2018.

LHC i is 65% owned by the Company, 25% by the Company’s wholly owned subsidiary, SBS Holdings and Enterprises Corporation and 10% by the Sytengco family.

The properties acquired is a warehouse facility complex (the "Facility") that covers a total land area of around five (5) hectares together with ambient and cold storage facilities. machinery and other building improvements. The Facility will principally be used in the warehouse and distribution operations of the Company to serve as a key distribution center for regional market customers south of Metro Manila. Given that SBS customers are looking for savings, the south depot will allow greater opportunities for customers cut down on their logistics and sourcing organization, integrate the Company’s procurement and logistic capabilities in their business processes, and promote collaborations for supply chain optimization to simplify their operations. Further, this capital expenditure would not only help control residual risks in not owning major logistic facilities but it is also a good investment opportunity to broaden the Company’s asset base.

The arrangement will also allow the lease or use of the other areas for additional business building projects of SBS group. This arrangement permits the Company to grow and diversify its income streams.

The Transaction involved a combination of a stock purchase of the company owning the property lot and an asset purchase of the buildings, improvements and machinery of the Facility.

Specifically, on December 29, 2017, LHC entered into a Share Purchase Agreement with The Coca-Cola Export Corporation ("TCCEC"), a corporation duly organized and existing under the laws of the State of Delaware, United States of America and licensed to do business in the Philippines as a branch and the Bank of the Philippine Islands in trust for the Coca-Cola Affiliated Companies in the Philippines Retirement Plan ("Coke Phil. Retirement Fund") for the purchase of 100% equity interests of Benesale Land, Inc. ("BLI"). BLI is owner of 4.7-hectare parcel of land on which the Facility is located. Similarly, LHI separately entered into an Asset Purchase Agreement with TCCEC for the Facility properties and assets on December 29, 2017. The Transaction has overall cost of about P520 million, inclusive of related transactions costs, applicable taxes and fees.

The Closing of the Transaction and payment of the consideration were completed on February 9, 2018.

Under the Share Purchase Agreement, a total of 27,000 BLI shares representing the total outstanding capital stock of BLI will be acquired by LHC.

Under the Asset Purchase Agreement, LHC will acquire buildings, property improvements and machinery which include the warehouses, freezer and cold storage buildings, and other facilities owned by TCCEC.

The entire Transaction has an overall cost of about P520 million inclusive of related transactions costs, applicable taxes and fees.

Combination of the market and assessment values of the properties covered by the Transaction

The purchase price for the stock and asset sale is payable in full on closing date. The Closing took place on February 9, 2018.

The closing of the transaction was subject to the completion of the following:

1. Delivery of original documents of title for the properties to be conveyed;
2. Execution of the Deed of Absolute Sale
3. Submission of property tax clearances
4. Turnover over of physical possession and control of the properties involved
5. All necessary consents, approvals, notices, filings and registration for consummate the Transaction have been
obtained

Benesale Land, Inc.(""BLI") was incorporated on September 27, 1972 as a property holding company and is the owner of 4.7-hectare parcel of land on which building and land improvements owned by TCCEC are located. It was primarily involved in leasing its property lot to TCCEC.

BLI is owner of a 4.7-hectare developed industrial lot located in Calamba City in Laguna Province.

The Transaction has no immediate impact on the business, financial condition and operations of SBS. However, it is expected that the Transaction will result to some gains from the real estate investments and operational enhancements to be generated which will grow and diversify the Company's income streams in the future.

The information provided on the date of Board approval pertains to the date of approval of the Board of Directors of Lence Holdings Corporation.

Attached is the latest financial statement of Benesale Land, Inc.

The Corporation has obtained the consent of the relevant parties in making this disclosure and submitting the attached financial statements.


This amends the Company Announcement under Circular No C00421-2018 to report on completion of the closing of the transaction which took place on February 9, 2018.