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Heineken said today it is offering $4.1 billion to buy out its partner in the Singapore-based maker of Tiger beer, attempting to neutralise a Thai tycoon’s competing bid for influence over the brand as the Dutch brewer expands in emerging markets.
Heineken said it has made a proposal to the board of Fraser & Neave Ltd, which shares ownership of the Tiger beer brewer Asia Pacific Breweries Ltd with Heineken, to pay $40 a share for F&N’s nearly 40 per cent stake.
The offer is worth $4.1 billion and would give Heineken about an 82 per cent stake in APB. If the offer is accepted, Heineken would spend a further $2 billion to buy out the minority APB shareholders.
The Dutch brewer’s move comes after Chang beer and Mekhong rum maker Thai Beverage, controlled by tycoon Mr Charoen Sirivadhanaphakdi, earlier this week said it had entered into agreements with three shareholders to take a 22 per cent stake in Fraser & Neave for $2.2 billion.
Separately, a private company owned by the son-in-law of the Thai billionaire bought about an 8 per cent stake in APB at $40 a share.
The Amsterdam-based company said in a statement that increasing its stake in APB, which also brews Heineken beer, is consistent with its strategy of growing in emerging markets. In recent years it has bought brewers in Mexico and Brazil, expanded in India through a partnership with United Breweries and increased its presence in Africa.
“It is time for us to look ahead to the next chapter of our Asian business,” said Heineken’s CEO Mr Jean-Francois van Boxmeer.
“Both the Heineken and Tiger brand will spearhead our brand portfolio in Asia,” he said.
Heineken currently has a 41.9 per cent stake in APB through a direct 9.5 per cent shareholding and an indirect shareholding of 32.4 per cent that is held through a joint venture with Fraser & Neave.
The Singapore food and beverage conglomerate, which has been in business with Heineken for the past 80 years, owns 39.7 per cent of APB via the joint venture and a 7.3 per cent direct stake.
Heineken said its offer is a 45 premium to the average price of APB shares in the past month.
Apart from Tiger and Heineken, APB’s well known beers in Asia include Bintang and Anchor.
Singapore trading in shares of APB and Fraser & Neave was suspended today following news of Heineken’s bid.
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