"We believe this valuation reflects a fair and full value for La Tondena's water and juice business as this translates to a 1.7 times enterprise value to sale and 15.7 times EBITDA (earnings before income tax, depreciation and amortisation)," La Tondena president Enrique Gomez said in a statement.

La Tondena, 64 per cent owned by San Miguel, said the transaction was expected to be finalised by the fourth quarter of this year. Mr Gomez said the sale of La Tondena's non-liquor business "allows us to focus our resources and direct our capital and attention on our core hard liquor and related businesses".

La Tondena's water and juice segments comprise 27 per cent of the company's total revenues while the hard liquor business accounts for the remaining 73 per cent and remains a solid driver of growth.

San Miguel for its part said in a separate statement it was consolidating its water and juice businesses with Coca-Cola Philippines. "We recognise that the competitive landscape in the water and juice segments is likely to change significantly in the next few years and we intend to maintain our leading position in those businesses," San Miguel chairman Eduardo Cojuangco said.

"By aligning our non-liquor interests, we will be well positioned to capture the industry's growth prospects." But San Miguel said the realignment was subject to San Miguel and The Coca-Cola company gaining approval to acquire Coke Philippines from minority shareholders of Australia's Coca-Cola Amatil. Coca-Cola will own the remaining 35 per cent in the Philippine bottling operations.