SINGAPORE--Heineken NV (HINKY, HEIA.AE) Wednesday scored a major
victory in its US$4.5 billion bid to acquire Fraser & Neave
Ltd.'s (F99.SG) entire stake in Asia Pacific Breweries Ltd.
(A46.SG), after a potential opponent and a key shareholder
announced support for the Dutch brewer's offer.
The shareholders of F&N are due to meet Sept. 28 to vote on
Heineken's offer to buy F&N's entire 39.7% stake in the maker
of Tiger beer. But recent moves by the companies of Thai
billionaire Charoen Sirivadhanabhakdi to bulk up their stake and
make a general offer for F&N had created uncertainty over the
fate of Heineken's offer.
In a joint filing to the Singapore Exchange, Thai Beverage PCL
(Y92.SG) and TCC Assets--which are controlled by Mr. Charoen--and
Heineken said that while Mr. Charoen's units "irrevocably" plan to
vote in favor of Heineken's offer for the stake, the Dutch company
has in turn promised not to bid for the whole of F&N, which has
other businesses, including property and soft drinks, that interest
Mr. Charoen.
Gaining control of Asia Pacific Breweries, the jewel in the
crown of F&N, would give Heineken the much-needed boost to
consolidate its position in the fast-growing Asia beer market. Full
control of Asia Pacific Breweries would see Heineken owning the
Tiger and Bintang APB beer brands that make up nearly 50% of the
beer market in Indonesia, Malaysia and Singapore, according to data
provider Euromonitor.
Asia Pacific Breweries has 30 breweries and 40 brands spanning
14 Asian countries. It also brews Heineken beer for some markets in
the region. Asia Pacific Breweries, an 81-year-old joint venture
between F&N and Heineken, first came into play in July, when
ThaiBev first bought a 22% stake in F&N, forcing Heineken to
make a US$4.1 billion offer for the brewing asset. At that time,
Mr. Charoen's son-in-law Chotiphat Bijananda also bought a 8.6%
stake in Asia Pacific Breweries.
Last month, Heineken raised its offer for Asia Pacific Breweries
to US$4.5 billion, representing a price-to-earnings ratio of 35.1
times earnings, well above peers including Carlsberg Brewery
Malaysia Bhd. (2836.KU), which trades at about 20.3 times earnings,
and Japan's Sapporo Holdings Ltd. (2501.TO), at 16.6 times. Its
sweetened offer reflected its desire to acquire an asset that would
give it exposure to a growing region at a time of slowing growth at
home.
Heineken now has a direct and indirect stake of 46.75% in Asia
Pacific Breweries.
Write to P.R. Venkat at venkat.pr@dowjones.com
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