Japan’s Asahi considering selling stake in Tsingtao Brewery

A man walks past the logo of Asahi Group Holdings at the company's headquarters in Tokyo, Japan, May 17, 2016. REUTERS/Toru Hanai

Japan’s Asahi Group Holdings said on Thursday it is considering selling all or part of its 19.99 percent stake in Tsingtao Brewery Co Ltd, its latest divestment from China’s beer industry as it seeks growth in Europe and other Asian markets.

Asahi’s decision to sell the stake, which it acquired in 2009 for around $666.50 million, follows its announcement in June to sell its 20 percent stake in Chinese brewer Tingyi-Asahi Beverages Holding Co Ltd for $612 million.

Tsingtao said Asahi holds 270.1 million of its Hong Kong listed H-shares. At Thursday’s closing price, the stake would be valued at nearly HK$8.5 billion ($1.09 billion).

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

That move gave the company around 9 percent of the European beer market, excluding Russia.

“We are engaging in efforts to ‘restructure our business portfolio with a focus on asset efficiency,’ to assess whether each business contributes to sustainable enhancement of corporate value,” Asahi said in a statement.

The company has said that it would restructure its operations in Southeast Asia and China, regions which are facing increased competition as the market consolidates just as growth slows.

It did not identify a potential buyer or selling price for the stake.

Tsingtao’s shares in Hong Kong ended down 2.3 percent before the announcement, and have struggled for traction over the past 12 months.
China is the world’s largest beer market by sales, but profits have been harder to come by amid fierce competition between local brewers and global beer giants AB InBev, Heineken NV and Carlsberg.