Economy

Asahi to offload Tsingtao Brewery Co stake for US$941m

The sale price of HK$27.22 per share amounted to a 32 percent discount to Tsingtao's last closing price in Hong Kong on Wednesday.

"China's brewery market is the largest in the world and the group is optimistic about the potential growth of the target company", Fosun said in a statement.

Cavender said the deal would likely go down well with Chinese regulators because it was "an example of Fosun coming home and investing in a Chinese asset" rather than overseas.

Fosun, one of China's most prolific deal-makers headed by billionaire Guo, is best known outside the country for its portfolio of businesses including French resort chain Club Med, margarine maker St Hubert and Portugal's largest listed bank Millennium bcp. In addition, Fosun also owns Israel's skin-care brand Ahava, and Greek fashion brand Folli Follie.

The deal is expected to close at the end of March, Asahi said in the statement. Asahi expects to book about a ¥6.3 billion profit ($56 million) from the sale in the first quarter of fiscal year 2018, company spokesman Takuo Soga said.

In Tsingtao, Fosun finds a century-old brewery that is grappling with changing consumer tastes, as a younger generation of drinkers flock toward craft beer, wine and other premium labels instead of working-class beverages. Despite being the country's third-biggest brewer, Tsingtao faces challenges in its home market. While Tsingtao is in the higher-quality category of local beers, it has struggled to position itself as foreign brewers such as Anheuser-Busch InBev and Diageo Plc have been gaining ground.

Asahi bought the stake in 2009 as it looked to expand into the mainland Chinese market.

Since then, Danish beer maker Carlsberg A/S had been among the investors weighing the purchase from Japan's largest brewery, Bloomberg reported in February, citing people familiar with the matter, without identifying them. Asahi President Akiyoshi Koji said in a January interview that "ownership without control doesn't make much sense".

The maker of Japan's best-selling beer, Asahi Super Dry, has been intensifying its focus on Europe, and bought a group of eastern European beer brands from Anheuser-Busch InBev late a year ago for 7.3 billion euros.



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