ThaiBev emerges as sole bidder for US$2b Sabeco stake

[TOKYO] A unit of Thai Beverage Pcl is the only investor to register to buy at least a 25 per cent stake in Vietnam's largest beer company, according to the Vietnam trade ministry's website, in a sale that would be valued at more than US$2 billion.

ThaiBev was one of about a half-dozen foreign companies, including Anheuser-Busch InBev NV and Asahi Group Holdings Ltd, that expressed an interest in bidding for Saigon Beer Alcohol Beverage Corp, or Sabeco as the company is known. The closing date for registration for a stake of more than 25 per cent in a Dec 18 auction was on Monday, though other companies can still bid for less than that amount.

ThaiBev, controlled by billionaire Charoen Sirivadhanabhakdi, declined to immediately comment. Trading in the company was halted in Singapore on Tuesday pending an announcement.

Sabeco shares surged 7 per cent, the daily limit, at the opening of trading Tuesday in Vietnam. Hanoi Beer Alcohol & Beverage JSC, which is expected to have a share sale early next year, also jumped 7 per cent.

Vietnam is seeking to raise at least US$4.8 billion in the country's biggest stake sale, and global brewers have been drawn to the heady growth prospects of the country's beer market.

An expanding Vietnamese middle class and youthful population helped drive a 300 per cent surge in beer demand since 2002, according to Euromonitor. But many companies have been put off by Sabeco's valuation, as the stock has soared 48 per cent this year.

The sale of a 25 per cent stake in Sabeco would be worth US$2.3 billion based on the government's initial price guidance of 320,000 dong (S$19.04) a share, about 9 per cent above Monday's closing price.

The government is offering 53.6 per cent of the brewer, though foreign investors are limited to a 38.59 per cent stake. Combined with the 10.4 per cent already held by investors from overseas, that would hit the foreign ownership cap imposed by Vietnam on some public companies.

Hui Choon Kit, chief financial officer of Fraser and Neave Ltd, a vehicle for Thai Beverage's international expansion, said last month that Sabeco was too expensive at its current share price.

Fraser and Neave has had experience working in Vietnam's beer market from its earlier part ownership of Asia Pacific Breweries, which owns Tiger Beer. It sold the stake to Heineken five years ago. Last month, Thai Beverage purchased a 49 per cent stake in a Vietnamese food and beverage alliance.

The government is divesting stakes in Sabeco and Hanoi Beer Alcohol Beverage Corp as a growing budget deficit forces the leadership to accelerate a plan to reduce holdings in state-owned firms.

BLOOMBERG