China Resources fails to see business logic in Anheuser bid

China Resources Enterprise's chairman believes the latest salvoes in the takeover battle for Harbin Brewery defy business logic, saying investment returns alone could not possibly warrant Anheuser-Busch's recent offer of $5.58 per share.

Although China Resources is SABMiller's joint venture partner in China Resources Breweries (CRB), Harbin Brewery's principal domestic rival, the red chip had said little thus far on the South African firm's struggle with Anheuser.

'Suddenly, all parties have changed their views on the mainland beer market after foreign investors deserted it five years ago,' China Resources chairman Frank Ning Gaoning said. 'I don't know how foreign firms calculate the return on their assets. They must be using a long-term perspective.'

SABMiller holds a 29.4 per cent interest in Harbin Brewery, China's fourth-largest brewer, and 49 per cent of CRB, the country's second-largest. Anheuser bought 29 per cent of Harbin Brewery last month.

Mr Ning said CRB was about to launch its anchor beer brand 'Snow' in Beijing, Shanghai and Guangdong, in a move analysts said might be an attempt to pre-empt a similar move by Harbin Brewery with its 'Harbin' brand. Both beers are primarily marketed in northeast China.

Meanwhile, Anheuser president and chief executive Stephen Burrows told the South China Morning Post that his company was committed to co-operating with Harbin Brewery's management to build the Harbin brand nationwide, while balancing the interests of Tsingtao Brewery, in which Anheuser holds a 9.9 per cent stake.