A BIDDING WAR is brewing in Asia between Dutch giant Heineken and a group linked to one of Thailand’s richest men, Charoen Sirivadhanabhakdi, for the maker of Singapore’s Tiger beer. There are signs it could be coming to a head.
The battle for Asia Pacific Breweries is the latest sign of the growing importance of the Asian consumer in what is one of the last expanding beer markets, and it’s also evidence of the growing financial muscle of Asian investors.
GDP in the Association of Southeast Asian Nations (Asean) is forecast to rise from €1.87 trillion in 2012 to €8.13 trillion by 2030.
Charoen’s Thai Beverage made a surprise counter-offer for a direct stake in Asia Pacific held by the Singapore conglomerate Fraser Neave (FN), topping Heineken’s bid by a full 10 per cent. Thai Beverage already owns around 24 per cent of FN.
Heineken began brewing Tiger with FN in the 1930s, but that long partnership is now on the rocks after Charoen’s company bought stakes in FN and APB last month.
The company that made the unsolicited Sg$1.03 billion (€670 million) bid for APB shares, Kindest Place, is owned by a son-in-law of the tycoon and already has 8.6 per cent of the company.
The move could force the Dutch brewer to pay more for control of Tiger Beer, 24 breweries in Asia and lucrative soft-drink brands. The outcome should be decided by Friday.
Not surprisingly, the counter-offer drove shares in Asia Pacific to a record high of Sg$52.20 (€34.11).
This compares to the Sg$50 (€32.67) per share offered by Heineken, which already owns 42 per cent of APB, for the 40 per cent stake held directly and indirectly by its longtime partner FN.
Heineken is keen to start building its position in the 10-member Asean market, which has some 600 million consumers.
Tiger is one of the bigger brands, but there is also Thai Beverage’s Chang Beer, San Miguel from the Philippines and Indonesia’s Bintang, also owned by APB. Other big foreign brands include Denmark’s Carlsberg, Japan’s Asahi and, of course, our own Guinness.
Beer consumption in nine Asean countries totalled 6.84 billion litres in 2011, up about 6.2 per cent from 2010, with Vietnam, Thailand and the Philippines leading the market, data from research firm Euromonitor showed.
Amsterdam-based Heineken is now under pressure to improve its proposal before an extraordinary general meeting of FN shareholders.
APB reported revenues of Sg$773.42 million (€505 million) in its second quarter ending March 31, up 15 per cent from a year ago, with most sales generated in the Asean region.
