MANILA, Philippines - Diversifying conglomerate San Miguel Corp. may price the shares it plans to sell at P110 to P140 each, well below what the company had targeted, IFR reported, quoting bookrunners.

The price guidance is below San Miguel's market close of P153 on April 12, when it asked for a voluntary trading suspension which will end on May 4.

San Miguel had announced it would raise about $850 million from the sale of shares and exchangeable bonds to raise funds for infrastructure investments.

IFR, a Thomson Reuters unit, reported that the company will offer 3-year bonds that can be converted into treasury shares. The coupon range is at 2% to 2.5%, with an exchange premium of 20% to 25% over the offer price of the share issue.

There was also a 10% greenshoe of shares that would be sold by Top Frontier Investment Holdings Inc., San Miguel's largest shareholder.

San Miguel has tapped Credit Suisse and Standard Chartered Securities (Singapore) Pte Ltd as joint global coordinators and international joint bookrunners for its stock offer.

Goldman Sachs (Singapore) Pte and UBS AG are also international bookrunners, while BDO Capital & Investment Corp. and SB Capital Investment Corp. are domestic bookrunners.

San Miguel's $850-million capital raising is less than one-fifth of the $5 billion it previously announced.

Raise free float

San Miguel will use sale proceeds to help fund a P22-billion investment in infrastructure projects the government plans to put up for auction, but it did not specify any particular deals.

Its president, Ramon Ang, also said the share sale would widen the company's shareholder base and public float, which is below the 10% minimum requirement of the stock exchange.

San Miguel, the dominant player in the local food and beverage industry, has diversified over the past 2 years into power, mining, infrastructure, telecommunications and oil refining to fuel growth.

It partly owns Manila Electric Co., the country's biggest power distributor, and accounts for more than 29% of the installed capacity in Luzon.

In February, Ang said San Miguel could spend $5 billion to add 3,000 megawatts of energy capacity in 5 years. - With a report from Reuters