SINGAPORE - Fraser and Neave has lost a legal spat with a joint venture partner that has been trying to force F&N to sell out of Myanmar Brewery, seen by many as the crown jewel in its drinks business.
Myanma Economic Holdings Limited (MEHL) said today that arbitrators in the dispute between MEHL and F&N have ruled in its favour, and affirmed MEHL's rights under a joint venture agreement to buy F&N's 55 per cent stake in Myanmar Brewery, which makes Myanmar Beer.
MEHL, which holds the remaining 45 per cent, had earlier said that F&N has defaulted on a term in the joint venture agreement, giving it a "clear right" to buy F&N's stake.
But F&N disputed MEHL's claim, saying that it had no basis.
The arbitration tribunal in a ruling released today have declared that MEHL is entitled to buy F&N's shares in Myanmar Brewery at fair value as at a date close to April 24 2013. The valuation will be decided by a valuer to be appointed by both parties.
Mr U Myint Aung, MEHL's deputy managing director, said: "We are very pleased with the ruling. It vindicates our legal position that the joint venture agreement clearly provides for us to buy F&N's shares after they failed to meet their contractual obligations.
MEHL took the case to arbitration last year after months of bilateral negotiations failed.