Japan's Asahi considers options after reports of bid for Grolsch, Peroni

[TOKYO] Japan's Asahi Group Holdings Ltd said on Tuesday it is exploring various possibilities after media reports that it will submit a bid to buy Grolsch and Peroni, two beer brands owned by SABMiller PLC, for as much as US$3.4 billion.

Anheuser Busch InBev SA, which agreed to buy SABMiller for US$100 billion plus, has been seeking potential bidders to buy Grolsch and Peroni, sources close to the process told Reuters last month.

Peroni and Grolsch are small, premium brands and AB InBev wants to avoid getting bogged down in regulatory scrutiny over a European portfolio that already includes Corona and Stella Artois, the sources said.

Japanese brewers have been widely expected to snap these assets up, as they have been struggling to grow at home in a saturated market with a shrinking population.

The Yomiuri daily reported that the deal could be worth about 400 billion yen (S$4.9 billion), and would be the biggest overseas beverage acquisition by a Japanese company, topping Kirin Holdings Co Ltd's US$3.3 billion takeover of Australia's Lion Nathan in 2009.

Forays abroad are increasingly crucial with domestic beer consumption falling in Japan over the past two decades. Japanese beer makers often rely on gimmicks such as seasonal packaging and limited-edition drinks to stimulate the domestic market.

Analysts said more overseas M&A deals could help Japanese brewers broaden sales channels of their existing beer brands.

Asahi and Kirin hold more than 90 per cent of their domestic market, but are tiny globally despite long-standing pledges to do more overseas.

Shares in Asahi fell 1.9 per cent by 0140 GMT, broadly in line with a 1.7 per cent decline in the broader market.

REUTERS