Century Pacific Food Inc. said it is acquiring coconut processing firm Coco Harvest Inc. in Misamis Occidental in Mindanao.
The company however refrained from revealing how much it is acquiring 100 percent of Coco Harvest, saying it is “less than 5 percent” of its assets as of Dec. 31, 2023.
Century Pacific reported P51.54 billion in assets as of end-2023, which puts the acquisition amount at less than P2.58 billion.
Century Pacific said in a statement that coupled with a further investment in facility improvements, it has allocated “$40 million” for the transaction which, at the current exchange rate, amounts to P2.25 billion, sourced from internally generated cash.
Built in 2016, the fully integrated facility of Coco Harvest sits on a 6-hectare property and has the capability to produce higher value coconut-based products, such as coconut water, coconut milk, desiccated coconut and virgin coconut oil.
“Furthermore, the existing facility is strategically located to capitalize on the abundance of coconut supply in the region,” the company said.
“The capacity expansion is expected to generate more than 1,500 quality manufacturing jobs in Mindanao. It will also create demand for auxiliary services needed by the plant as well as provide market access for the harvests of coconut farmers in the region,” it added.
Ted Po, Century Pacific chief executive officer, said the milestone deal is an “accretive acquisition.”
“Our coconut business, encompassing both domestic and export, has grown substantially these past few years on the back of burgeoning trends in health and wellness. The additional capacity from Coco Harvest will bolster our capability to serve rising demand, with room for expansion as the business grows,” he said.
The acquisition follows the renewal in March of Century Pacific’s tolling contract with The Vita Coco Company Inc. for coconut water, which increases volume commitments from Vita Coco to approximately 90 million liters over the next five years.
Century Pacific entered the coconut category in 2012 as a manufacturer of coconut water for original equipment manufacturer export.
“Since then, the export business has grown organically as the company built manufacturing capability in other product formats, serving key players in Southeast Asia such as Linaco Manufacturing,” it said.
Po said Century Pacific anticipates that the business will outgrow the facility’s current capacity and has plans for further investments in expansion in the future.
“We are encouraged by the long-term growth trajectory of our coconut business. From where we started, it has evolved to become globally competitive in the category through the team’s commitment to excellence and innovation. It’s a platform where we believe we can create more value for the company as well as the local coconut farming industry,” he said.
