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Thai Beverage chief backs Heineken's Asia Pacific Breweries bid

Thai billionaire supports Dutch brewer's buyout offer for Singapore-based company

PUBLISHED : Thursday, 20 September, 2012, 12:00am
UPDATED : Thursday, 20 September, 2012, 4:18am

Heineken cleared the biggest hurdle in its fight to take control of Asia Pacific Breweries as billionaire stakeholder Charoen Sirivadhanabhakdi's Thai Beverage pledged its support.

Thai Bev and Charoen's TCC Assets will back Heineken's S$5.6 billion (HK$35.43 billion) bid for Fraser & Neave's 40 per cent stake in the business at a shareholder meeting next week after the Dutch brewer agreed not to make a competing offer for F&N, the Amsterdam-based brewer said yesterday. Heineken had previously operated APB via a joint venture with F&N.

"For Heineken, this significantly improves the level of certainty that our offer will be approved", at the meeting, Heineken spokesman John Clarke said.

APB would be the Dutch brewer's largest acquisition since its 2010 purchase of Fomento Economico Mexicano's beermaker as it seeks to expand in faster-growing emerging markets, according to data.

Singapore-based APB has rights to brew Bintang in Indonesia, Anchor in China, Southeast Asia and Sri Lanka, and Heineken from China to New Zealand.

TCC, controlled by 68-year-old Charoen, offered S$9 billion on September 13 to buy the 70 per cent of F&N he did not control, throwing Heineken's takeover of APB into doubt.

Heineken had originally been spurred to bid for control of APB, in which it held 42 per cent, after a company controlled by Charoen's son-in-law bought shares in APB.

The agreement "should be very positive for Heineken's share price", ING analyst Gerard Rijk said. "The company will not need to raise its offer further and it will be able to consolidate the APB business."

F&N shareholders are scheduled to meet on September 28 to vote on Heineken's offer to buy F&N's shares in APB. F&N recommended that holders accept Heineken's increased bid of S$53 a share in August. Heineken, the world's most acquisitive brewer in the past 12 months, had said it would be its final offer.

F&N also has a food and soft-drinks unit and a real estate division. TCC Assets, linked to Charoen's Thai Bev, offered S$8.88 a share for F&N.

The bid is the largest announced by a Thai company in at least 10 years, according to data compiled by Bloomberg.

Charoen's agreement to support Heineken's offer for APB may spur speculation that he would break up F&N, a 129-year-old group.

Japan's Kirin Holdings owns a 15 per cent stake in F&N and had considered making a bid for its food and soft-drinks unit, several people with knowledge of the matter said in August. Coca-Cola explored a bid for the drinks operations, people with knowledge said.

F&N got 30 per cent of its 2011 revenue of S$6.3 billion from property, 12 per cent from soft drinks and 17 per cent from dairies, according to data compiled by Bloomberg.

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