Heineken today secured a Singapore group’s approval for its takeover of the Tiger Beer brand, boosting the Dutch giant’s share of the Asian market after a high-stakes tussle with a Thai rival.
Shareholders of Fraser and Neave (F&N), the parent of Asia Pacific Breweries (APB), approved Heineken’s offer of $4.6 billion for its 40 per cent stake in APB, which has breweries in 14 markets including China.
Amsterdam-based Heineken is seeking to boost sales in fast-growing Asian economies as demand falls in mature western markets. It already held 42 per cent of APB, which also makes Bintang beer, the top brand in Indonesia.
“I declare the resolution carried,” F&N Chairman Lee Hsien Yang said after 98.73 per cent of shareholders voted for the deal, which is expected to be formally completed by late November.
Shareholder Simon Zee, 57, said the result was expected and he supported the takeover because it was “value for money” for people like him.
“I think Heineken will probably keep Tiger Beer, because Tiger Beer is an international brand name,” he said, referring to some Singaporeans’ fears that one of the city-state’s best-known brands might fade away in the long term.
Heineken, which has been an F&N partner for 81 years, has publicly vowed to grow the Tiger Beer brand and APB’s other businesses after the takeover.
One analyst said Heineken paid a steep price to fend off a challenge from a Thai faction in F&N, led by beverage billionaire Charoen Sirivadhanabhakdi, who eventually gave his approval to the sale after Heineken raised its offer.
“Heineken are paying a pretty penny for APB, at about 35 times its current earnings, which is very high,” Justin Harper, an analyst at IG Markets Singapore, told AFP.
“This shows how much it values APB and the brands it controls. Along with Tiger and Bintang, APB has an impressive 50 per cent market share of beer sales in Indonesia, Malaysia and Singapore.”
Before today’s F&N shareholders’ meeting in Singapore, Heineken bought an additional 8.6 per cent in APB held by Thailand’s Kindest Place Groups, also linked to Charoen, for $961 million.