Heineken faces bidding war over stake in Asia Pacific Breweries

Dutch brewer Heineken’s plan to buy out Asia Pacific Breweries (APB), the owner of Tiger beer, is facing a new challenge after Kindest Place, a firm controlled by the family of Thai billionaire Charoen Sirivadhanabhakdi, put forward a new offer.

Recently, Fraser and Neave (F&N), a Singapore conglomerate involved in the food and beverage, brewing, property and publishing industries, agreed to sell its 39.7% stake in APB to Heineken at S$50 ($40.18) per share, for a total consideration of $4.23bn.

With this deal, Heineken would have gained an 82% stake in APB, following which it planned to buy out minority shareholders on the same basis, which would have taken the value of the total transaction to $6bn.

However, on 7 August, Kindest Place offered a higher price of S$55 ($44.20) for a 7.3% stake in APB, challenging the existing agreement.

If the latest offer is finalised, the Thai company will gain control of a 15% share in APB, as it already agreed to acquire APB’s 7.9% stake from Oversea-Chinese Banking and its insurance unit Great Eastern in July 2012 at a lower price of S$45 a share.

This deal would lead to F&N holding a significant share of more than 30%, leaving Heineken without a controlling stake.

The Dutch brewer may have to raise the bid to overcome the offer put forth by Kindest Place in order to gain control of APB, which has a leading position in several markets such as Vietnam and Singapore.

Meanwhile, Heineken announced that it is pursuing discussions with F&N in relation to the deal, and added that its offer is better as it covers F&N’s whole stake.

APB, a joint venture between Heineken International and F&N, owns 30 breweries in 12 countries in the Asia Pacific region, selling over 120 brands of beer and beer variants.

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Image: To gain control of APB Heineken may have to raise its bid to overcome the offer put forward by Kindest Place. Photo: Skitof.