China Resources Beer to raise HK$9.5b in rights issue to part-fund SABMiller stake purchase
Country’s biggest brewer reveals deeply discounted offer
China Resources Beer, the country’s biggest brewer, is planning to raise HK$9.5 billion as it prepares to buy the remaining 49 per cent stake in China Resources Snow Breweries, a joint venture it currently owns with London-based SABMiller.
The Chinese state-owned conglomerate said on Wednesday part of the money raised would be used to fund the purchase, that will see CR Beer gain full control of the popular Snow beer brand.
The rights issue, likely to be one of the largest in Hong Kong since last year, is being priced at a 30.8 per cent discount to Tuesday’s closing price of HK$16.94.
The company plans to issue around 811 million new shares at HK$11.73 for every three existing shares held. CR Beer’s shares closed Wednesday at HK$16.26, down 4.01 per cent.
“We opted for a right issue together with other tools to finance our acquisition as that can boost our balance sheet and make us more flexible for future M&A opportunities,” its Chief Financial Officer Lai Po-sing said.
