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Heineken tables $4bn offer to acquire Asia Pacific Breweries

Dutch brewer Heineken NV (AMS:HEIA) said on Friday it had placed a SGD5.1bn (USD4.1bn/EUR3.3bn) offer to buy the direct and indirect stakes in Singapore-based peer Asia Pacific Breweries Ltd (SGX:A46), or APB, held by Fraser & Neave Ltd (SGX:FNN), or F&N, in line with a strategy to expand in emerging markets.

The offer at SGD50.00 a share outmatched that of SGD45.00 a piece made by Thai businessman Charoen Sirivadhanabhakdi and his family for part of these holdings. Once it meets all conditions to this offer, the Dutch group said it would launch a mandatory bid for the remaining APB shares not yet owned by it at the same price per share, or a maximum consideration of SGD2.4bn.

Heineken has also proposed to buy F&N’s interest in the non-APB assets controlled by Asia Pacific Investment Private Ltd, APIPL, their 50/50 joint venture, for SGD163m, the buyer said.

F&N holds a direct stake on 7.3% in APB and a 50% interest in APIPL, which controls 64.8% in beer and stout maker and seller APB, while Heineken, the owner of the other 50% in APIPL, controls 9.5% in APB.

The deal, if agreed, would give Heineken a stronger platform for growth in dynamic markets, allowing it access to Cambodia, China, Indonesia, Malaysia, New Zealand, Papua New Guinea, Singapore, Thailand and Vietnam, while widening its portfolio by ensuring control over internationally known Tiger beer brand, as well as other regional and local brands, it said.

It would also be able to consolidate APB in its accounts, ensuring improved visibility to its operations in Asia.

Commenting on the offer, Heineken’s chairman and CEO Jean-François van Boxmeer described its as “highly attractive” for F&N and APB shareholders, while creating long-term value for Heineken’s shareholders by giving it control of APB. The move marks the next step in the group’s strategy for its Asian business, with Singapore continuing to be its regional headquarters and the Heineken and Tiger beer brands to lead its portfolio in the region, he added.

Heineken expressed its desire to reach a friendly deal with F&N, but it would review all available options should it be prevented from extending its offer to all APB shareholders.

Its bid is subject to F&N board accepting it and shareholders voting in favour of it.

Credit Suisse Group AG (NYSE:CS) and Citigroup Inc (NYSE:C) are advising Heineken.


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