Vietnam moves one step closer to majority stake sale in brewer Sabeco

[HANOI] Vietnam's prime minister has approved a plan to sell a majority stake in brewer Sabeco, a government committee said in a document seen by Reuters on Tuesday, taking the state-controlled brewer one step closer to a long-awaited sale.

Vietnam has one of the world's most attractive beer markets and the biggest in Southeast Asia, thanks to a young population that consumed nearly 4 billion litres in 2016.

Foreign brewers from Kirin to Heineken have been looking at a possible investment in the maker of the Bia Saigon and 333 brews since it was earmarked for privatisation. But long-stated plans for the government, which still owns about 90 per cent, to sell a majority stake have met with repeated delays.

A meteoric rise in Sabeco's share price due to high demand and a small float has complicated matters, making it difficult for industry buyers - including Heineken which already owns a 5 per cent share - or other investors to step in.

The stock listed at 110,000 dong (S$6.56) but is now trading at around 255,000 dong, a more than 130 percent increase.

The government wants to sell 53.59 per cent of Sabeco, according to a document by Vietnam's Steering Committee for Enterprise Innovation and Development dated Aug 30. The document, however, did not mention a timeline for the sale or how much the government wants to raise.

Sabeco, the country's second-biggest listed firm by market value, is a key plank of a broader privatisation effort, which includes dairy firm Vinamilk, Vietnam Airlines and rival brewer Habeco.

The Vietnamese government also plans to sell a further sliver of Vinamilk, around 3 per cent, at 154,000 dong each, higher than the previous estimate, according to a government document seen by Reuters on Tuesday.

The divestment out of Vinamilk, Vietnam's top firm by value, is expected to bring in 7.443 trillion dong to the state, Vietnam's Steering Committee for Enterprise Innovation and Development said in a statement dated Aug 30.

The State Capital Investment Corp, the government's representative in Vinamilk, said it estimated the stake sale would fetch 6.5-7 trillion dong.

REUTERS