Many San Miguel Corporation shareholders have already started to avail of the firm’s exchange offer by submitting their applications to exchange their common shares to preferred shares.

SMC said this is according to Citibank and ATR KimEng Capital Partners Inc., as joint lead arrangers and receiving agents for the exchange offer of San Miguel.

“As the deadline nears for the San Miguel share-swap option, I was informed of this development, that the conversion plan has been received positively, with more and more shareholders opting to convert their shares,” said SMC president Ramon S. Ang.

The principal reasons given for availing of the Exchange Offer were the higher face value of the preferred shares of P75.00 per share versus the market price of the common shares of P51.00 per share when the exchange was first announced.

The preferred shares also promise a higher dividend rate of 8 percent per annum, which translates to P6.00 per share per annum versus the common dividend of P1.40 per share given in the past many years.

The receiving agents added that a few shareholders did raise their concerns about the new businesses of San Miguel as a contributing reason for availing of the exchange.

SMC had extended by one month the offer period for its exchange offer of one Series “1” Preferred share for every common share from August 20, 2009 up to 12 noon of September 21, 2009 to allow more shareholders to participate.

Stockholders of record as of July 2, 2009 will be entitled to exchange their common shares to preferred shares provided they remain stockholders of record at the end of the Offer Period.

The firm said it has decided to list with the PSE the new class of preferred shares it is offering to swap for the firm’s common shares to give shareholders an option for assured annual dividends.

SMC chief finance officer Ferdinand Constantino said that the Executive Committee of SMC has authorized Management to list the Series 1 preferred shares within one year from the date of issuance.