State firm seek­ing op­tions for Snow beer unit

China Daily (Canada) - - LIFE - By BLOOMBERG

China Re­sources Beer (Hold­ings) Co will soon ask in­vest­ment banks to pitch for a role ad­vis­ing on op­tions for its Chi­nese brew­ery joint ven­ture with SABMiller Plc, peo­ple with knowl­edge of the mat­ter said.

The State-backed com­pany is seek­ing ad­vis­ers as it weighs a po­ten­tial pur­chase of all or part of SABMiller’s 49 per­cent stake in China Re­sources Snow Brew­eries Co, the maker of Snow, the world’s best-sell­ing beer, the peo­ple said. China Re­sources has told banks it will send out a for­mal re­quest for pro­pos­als as early as this week, the peo­ple said, ask­ing not to be iden­ti­fied as the in­for­ma­tion is pri­vate.

An­heuser-Busch InBev NV may need to sell the stake in the brewer of Snow lager to se­cure Chi­nese an­titrust ap­proval for its 73.5 bil­lion pound ($110 bil­lion) ac­qui­si­tion of SABMiller, which will cre­ate a beer­maker controlling about half the in­dus­try’s prof­its. SABMiller’s stake in the Chi­nese ven­ture could fetch as much as $3.6 bil­lion, No­mu­raHold­ings Inc wrote in a re­search re­port.

“China Re­sources

has al­ready learned enough from SABMiller about how to op­er­ate a beer fac­tory ef­fec­tively and now can man­age it by it­self,” Char­lie Chen, an an­a­lyst in­BNPParibas SAinHong Kong, said onMon­day.

“China Re­sources may buy the stake with an­other Chi­nese lo­cal beer firm.”

Shares of SABMiller re­versed ear­lier losses to close up 0.1 per­cent at 40.315 pounds in Lon­don onMon­day. China Re­sources shares rose 0.133 per­cent to HK$15.1 ($1.95) at close on Tues­day in Hong Kong.

China Re­sources aims to pick ad­vis­ers by the end of the year, the peo­ple said., adding AB InBev has not yet de­cided whether it will sell the stake, and China Re­sources is not set on any ac­tion.

Sev­eral banks have reached out to China Re­sources in re­cent weeks to of­fer fi­nanc­ing for any po­ten­tial buy­out of the Snow joint-ven­ture stake, ac­cord­ing to the peo­ple. They said China Re­sources is seen as the log­i­cal buyer ifABInBev de­cides to sell, as it has a right of first re­fusal.




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