ThaiBev is sole bidder for over 25% stake in Vietnam beer firm

TOKYO • A unit of Thai Beverage (ThaiBev) is the only investor to register to buy at least a 25 per cent stake in Vietnam's largest beer company, according to the Vietnam Trade Ministry's website, in a sale that would be valued at more than US$2 billion (S$2.7 billion).

ThaiBev was one of about half a dozen foreign companies, including Anheuser-Busch InBev and Asahi Group Holdings, that expressed an interest in bidding for Saigon Beer Alcohol Beverage, or Sabeco as the company is known.

The closing date for registration for a stake of more than 25 per cent in a Dec 18 auction was on Monday, while those seeking less than that amount can still participate.

ThaiBev, controlled by billionaire Charoen Sirivadhanabhakdi, declined to immediately comment. Trading in the company was halted in Singapore yesterday, pending an announcement.

Vietnam is seeking to raise at least US$4.8 billion in the country's biggest stake sale.

Global brewers had been lining up to get a taste of Vietnam's beer market. An expanding Vietnamese middle class and youthful population helped drive a 300 per cent surge in beer demand since 2002, according to Euromonitor.

But many companies have had to consider Sabeco's valuation, as the stock has soared 48 per cent this year.

  • 300%

  • Surge in beer demand in Vietnam since 2002, driven by an expanding middle class and youthful population.

The sale of a 25 per cent stake in Sabeco would be worth US$2.3 billion, based on the government's initial price guidance of 320,000 dong (S$19) a share, about 9 per cent above Monday's closing price.

The government is offering 53.6 per cent of the brewer, though foreign investors are limited to a 38.59 per cent stake.

Combined with the 10.4 per cent already held by investors from overseas, that would hit the foreign ownership cap imposed by Vietnam on some public companies.

Mr Hui Choon Kit, chief financial officer of Fraser and Neave (F&N), a vehicle for ThaiBev's international expansion, said last month that Sabeco was too expensive at its current share price.

F&N has had experience working in Vietnam's beer market from its earlier part ownership of Asia Pacific Breweries. It sold the stake to Heineken five years ago.

Last month, ThaiBev purchased a 49 per cent stake in a Vietnamese food and beverage alliance.

The government is divesting stakes in Sabeco and Hanoi Beer Alcohol Beverage as a growing budget deficit forces the leadership to accelerate a plan to reduce holdings in state-owned firms.

BLOOMBERG

A version of this article appeared in the print edition of The Straits Times on December 13, 2017, with the headline 'ThaiBev is sole bidder for over 25% stake in Vietnam beer firm'. Print Edition | Subscribe