SINGAPORE (THE BUSINESS TIMES) - Thai Beverage (ThaiBev) has confirmed it is looking to spin off and list its brewery unit BeerCo on the Singapore Exchange (SGX) mainboard.
In a regulatory filing on Friday morning (Feb 5), the beer and liquor giant said it has received a no-objection letter from SGX for the listing of nearly 20 per cent of BeerCo.
The shares jumped after the pre-market announcement. They were trading up three cents or 3.8 per cent to 82.5 cents as of 1.44pm. A married deal valued at under $150,000 took place in the morning session at 82.5 cents apiece, according to ShareInvestor data.
BeerCo has three breweries in Thailand as well as an interest in a network of 26 breweries in Vietnam. Its business includes the production, distribution and sales of beer including the Chang and Bia Saigon brands.
The group booked a profit after tax of $348 million on $4.7 billion in revenue for the full year ended Sept 30, 2020.
ThaiBev said it sees "significant growth potential" in its beer business. It believes the business could be better-developed with a dedicated board of directors and management team, and with direct access to debt and equity capital markets as a separately-listed entity.
"ThaiBev believes that the BeerCo group's position as one of the leading beer players in South-east Asia and its growth potential offers a distinct and compelling growth story," it said.
Meanwhile ThaiBev could use part of the proceeds generated from BeerCo's IPO to reduce debt and strengthen its financial position to invest in future business expansion plans.
ThaiBev is also of the view that its listing of BeerCo will provide a transparent valuation benchmark for BeerCo - allowing the core business of ThaiBev to be assessed and valued more distinctly.
The group's announcement comes a week after Bloomberg reported on the potential listing.
Bloomberg cited sources with knowledge of the matter saying that the group was seeking an estimated U$10 billion valuation for BeerCo, with the listing possibly taking place as soon as the second quarter of 2021.