ThaiBev bets big in Vietnam with US$4.8bil brewery stake
Firm is seeking to dominate South-East Asia’s beverage market
HO CHI MINH CITY: Thai Beverage Pcl (ThaiBev) is doubling down on Vietnam after it partnered with a local company to buy a US$4.8bil stake in the country’s largest brewer, a key step for billionaire Charoen Sirivadhanabhakdi’s controlled company as it seeks to dominate South-East Asia’s beverage market.
Vietnam Beverage, the local unit which ThaiBev holds a stake in, said it won the bidding for an almost 54% holding in Saigon Beer Alcohol Beverage Corp (Sabeco).
ThaiBev emerged as the only foreign investor to bid in what had been billed as a hotly-contested auction of Vietnam’s biggest asset sale on record.
Vietnam’s Ministry of Industry and Trade sold the Sabeco stake for 320,000 dong (US$14.09) a share, according to a statement to the stock exchange. That’s a 3.5% premium over Monday’s closing price.
Shares of Sabeco, as the brewery is known, jumped as much as 2.8% to 317,900 dong in Vietnam yesterday.
Vietnam investors were buoyed by the news, with the benchmark VN Index jumping 2.5%, the most since July 2016. Trading in Thai Beverage shares was halted in Singapore.
While global companies including Anheuser-Busch InBev NV and Asahi Group Holdings Ltd. had shown interest earlier, many were put off by Sabeco’s valuation as the stock surged 56% this year.
ThaiBev is paying a premium to get into Vietnam’s US$6.5bil beer market as it targets to expand across South-East Asia to diversify revenue streams.
“While the deal could be deemed pricey, it does give ThaiBev access to a strong player” in Vietnam’s growing beer market, CIMB-GK Securities analysts Cezzane See and Siew Khee Lim wrote in a note before the winning bid was announced.
“The acquisition is in line with the group’s Vision 2020 of being a regional beverage play.” — Bloomberg