San Miguel Brewery Inc., a unit of the Philippines? biggest food and drink company, plans to sell as much as P40 billion ($850 million) of bonds this quarter to fund the purchase of some of its parent group?s assets.

The brewer plans to sell about P15 billion of bonds to domestic investors, said a banker familiar with the plan. It may also sell about $500 million of foreign-currency debt overseas, said a company official. Both people declined to be identified because their employers haven?t authorized them to speak about the matter.

Company president Ramon Ang on Jan. 28 said the debt-free brewer would borrow to finance its P38.8-billion purchase of domestic beer brands, intellectual property rights and land from San Miguel Corp. In a stock exchange filing, San Miguel Brewery said it agreed to pay P32 billion to acquire San Miguel Corp.?s domestic beer brands plus ?related intellectual property rights and know-how? and a further P6.8 billion for parcels of land used in the beer business.

Kirin Holdings Co., Japan?s largest beer maker and the biggest overseas owner of shares in the parent, last week said it?s in talks to buy a 43.25 percent stake in the brewer.

San Miguel Brewery plans to sell coupon-bearing bonds with maturities of three and five years, and 10-year, zero-coupon notes to domestic investors as early as February, the banker said.

Local and foreign banks including HSBC Holdings Plc will help sell the peso-denominated notes while an overseas sale may take place before the end of the quarter, the company official said.

Parent San Miguel yesterday said it expected to complete the sale of assets to its brewing unit by April and would use money raised to pay off debt and for acquisitions. San Miguel last year agreed to buy 27 percent of Manila Electric Co. and bought an option to control Petron Corp., the largest oil refiner in the Philippines.

It is also expanding into the telecoms and mining sectors. Bloomberg and Jenniffer B. Austria