November 23, 2014

Purefoods acquires La Pacita trademarks, recipes

Various news outlets reported that San Miguel PureFoods (PF) acquired La Pacita biscuit maker’s trademarks, formulations, recipes and other intangible properties relating to La Pacita’s biscuit and flour-based snack business. La Pacita has been manufacturing biscuits, cookies and crackers for over 90 years.

This comes after PF’s failed bid to acquire United biscuits of UK earlier this year. This acquisition is in line with the company’s plan to expand its product portfolio in preparation for the upcoming Asean integration. In July earlier this year, PF announced its intention to expand its flour mill in Batangas and intention to build two new factories.

Our take: The acquisition of La Pacita fits well with the PF’s existing flour operations as it moves the company up the value chain from just a commodity producer to a branded snacks manufacturer.

While it remains to be seen if the company can execute well on this strategy, the re-launch of a 90-year old brand with the backing of the San Miguel group could provide some meaningful competition with other branded biscuit manufacturers such as Universal Robina Corp (URC). – WealthSec