HEINEKEN WON control yesterday of the Asian group that brews Tiger beer when Singapore’s Fraser and Neave (FN) agreed to sell its stake in the firm for 5.1 billion Singapore dollars, a deal that will help boost the Dutch group’s Asian growth.
The purchase gives Heineken 82 per cent of the prized Asia Pacific Breweries (APB) and it will now launch an offer for the rest of the company, while FN, a drinks and property group, could be broken up eventually.
Amsterdam-based Heineken already owned 42 per cent of APB, which runs 24 Asian breweries, and buying FN’s 40 per cent stake will help it to defend its turf which is under threat from Thailand’s second-richest man.
FN’s board, whose chairman Lee Hsien Yang is the younger son of Singapore’s elder statesman Lee Kuan Yew, will recommend the S$50 an APB share deal to its shareholders, Heineken said.
The Dutch company will now mop up minority shareholders at a similar price to make the total purchase worth about $6 billion.
Control of APB is vital for Heineken, as this will raise the proportion of its total profits from the fast-growing Asian market to 15 per cent from 6 per cent, while boosting the growth rate of the whole group. By winning APB, Heineken gets ownership of Tiger, Bintang, Anchor and other brands of beer plus two dozen breweries in 14 countries including Singapore, Malaysia, Indonesia, Vietnam, Thailand and Cambodia.
However, the biggest brand APB brews is Heineken itself, which accounts for 30 per cent of its volumes.
Heineken shares jumped to a record high earlier after Reuters reported the deal, and when official confirmation came through later they hit a fresh high of €46.30.
The Dutch group had given FN a deadline of yesterday to agree a sale after a two-week offer period, and both FN and ABP shares were suspended on Thursday and yesterday as a deal appeared close.
Heineken began brewing Tiger with FN in the 1930s but that partnership hit the rocks after Thai Beverage and others linked to Thai billionaire Charoen Sirivadhanabhakdi bought stakes in FN and APB for $3 billion last month. – (Reuters)
