Kirin buys US$560 mil. stake in Myan­mar brewer

The China Post - - WORLD BUSINESS -

Kirin has ac­quired con­trol of Myan­mar’s big­gest brewer, a com­pany spokesman said Thurs­day, as the Ja­panese bev­er­age gi­ant moves to counter slow­ing growth at home by tap­ping South­east Asian mar­kets.

The firm’s Sin­ga­pore unit pur­chased a 55 per­cent stake in Myan­mar Brew­ery Ltd., which makes pop­u­lar lo­cal brands and has an ex­ten­sive na­tion­wide sales net­work, from Fraser and Neave for US$560 mil­lion.

“The beer mar­ket in Myan­mar is still small, but we ex­pect it will ex­pand,” a Ja­pan- based Kirin spokesman told AFP, call­ing Myan- mar Brew­ery a “promis­ing part­ner.”

Myan­mar Brew­ery, which has about 1,000 em­ploy­ees, re­ported sales of around US$200 mil­lion last year.

In a state­ment an­nounc­ing the deal, Kirin said it hoped the ac­qui­si­tion would “fur­ther strengthen its busi­ness in the South­east Asian re­gion.”

Kirin op­er­ates a beer busi­ness in the Philip­pines with a lo­cal firm and al­ready has oper­a­tions in Sin­ga­pore and Viet­nam.

In­vestors in Tokyo cheered the deal, with Kirin shares adding 0.99 per­cent Thurs­day af­ter­noon as the broader mar­ket turned down.

For­eign com­pa­nies, in­clud­ing many Ja­panese firms, are in­vest­ing in fast-grow­ing Myan­mar, for­merly known as Burma, as it emerges from decades of iso­la­tion as a for­mer junta-run na­tion.

It of­fers an at­trac­tive prospect, with a grow­ing mid­dle class and one of the largest pop­u­la­tions in South­east Asia of more than 53 mil­lion peo­ple.

The coun­try clocked GDP growth of 7.7 per­cent for year end­ing March, and was tar­get­ing fur­ther in­crease of 8.3 per­cent in the 2015 fis­cal year, ac­cord­ing to the Asian De­vel­op­ment Bank.

Un­like its Western al­lies, Ja­pan main­tained trade ties and di­a­logue with Myan­mar dur­ing junta rule, which ended in 2011, say­ing a hard line could push it closer to main­land China.

At home, Ja­panese brew­ers are see­ing a slump in beer sales as younger peo­ple lose in­ter­est in the coun­try’s well-known busi­ness drink­ing cul­ture, which boosted sales for decades.

But they will face com­pe­ti­tion from in­ter­na­tional ri­vals in Myan­mar.

Dutch beer gi­ant Heineken last month said it has opened a US$60 mil­lion brew­ery, with a to­tal ca­pac­ity of 330,000 hec­to­liters per year which will di­rectly em­ploy more than 200 lo­cal peo­ple.

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