Battle for China's Harbin beer continues to brew
around 29 per cent of Chinese brewer Harbin, which is currently
subject to a hostile takeover bid by SABMiller.
Speculation is increasing that a counter-offer for Harbin Brewery Group is imminent after the world's largest brewer Anheuser-Busch announced that it had purchased a stake of around 29 per cent in the Chinese brewer.
"This investment complements our successful Budweiser operations in China and our strategic partnership with Tsingtao," said Stephen Burrows, chief executive officer and president of Anheuser-Busch International.
Anheuser-Busch already has a stake in Tsingtao, another Chinese brewery, with which it has an agreement to increase its stake in Tsingtao to 27 per cent over the next few years.
The shares in Harbin, meanwhile, were transferred to Anheuser-Busch after regulatory approval had been received from the Chinese authorities. The shares were transferred from an investment holding company, Global Conduit Holdings, which had acquired the shares from the City of Harbin pursuant to an earlier agreement.
The total purchase price was HK$1.08 billion (€116 m), or the equivalent of HK$3.70 (€0.40).
Hong-Kong listed Harbin is in the middle of a takeover battle between the world's two largest brewery conglomerates, US-based Anheuser-Busch and London-headquartered SABMiller.
SABMiller, which currently has a 29.4 per cent stake in Harbin, recently offered to buy all the shares that it does not already own in the company for HK$3.04 billion (€327 m), or HK$4.30 (€0.46) a share.
Even though the board of Harbin has issued a statement "strongly encouraging shareholders not to take action at this stage", SABMiller is due to issue the circular, the formal document setting out its offer, next week.
The company's head of financial media Nigel Fairbrass declined to comment on reports carried by the China Daily newspaper that Harbin would prefer a tie-in with Anheuser-Busch and said: "We have made an offer, we are confident this represents excellent value for the shareholders."
"We will issue a circular to shareholders and set out the offer, which will then be open for 28 days. We are confident of good acceptance levels," Fairbrass added.
The deal would mean a lot to SABMiller's China strategy. The company is already the second largest brewer in China, controlling 12 per cent of the market. Tsingtao Brewery has about a 15 per cent market share.
SABMiller also recently announced that China Resources Breweries, its joint venture with China Resources, intended to buy a 90 per cent stake in two breweries in Anhui Province. If the takeover bid goes ahead, SABMiller will become the biggest brewer in China.
Many industry analysts believe Anheuser-Busch will make a move shortly after publication of SABMiller's circular.
