Nine companies submit bids to buy stake in Vietnam’s Sabeco, deal size set to be over $1 billion

The Saigon Beer, Alcohol and Beverage Corporation (Sabeco), Vietnam’s largest brewer, plans to divest state holding to a minority 36 per cent, a source aware of the development told DEALSTREETASIA, even as the beverage producer Thursday said that nine firms had already submitted bids to buy a stake in it.

DEALSTREETASIA has earlier reported that several foreign players, including Thai Beverage Group, Singha Corporation – another Thai brewer, Japan’s Asahi Breweries, Heineken (which already holds five per cent stake in the Vietnamese state-owned beer producer) and the US-based SAB Miller, were examining potential investments in Sabeco. All these companies are likely to have submitted bids

Among the domestic investors, Duc Binh Group, Hung Thinh Diamond, Lien Viet GroupSaigon Securities Inc and Sunshine Consulting and Investment JSC are keen on acquiring a stake in Sabeco, DEALSTREETASIA has learnt. Most of these firms operate in the real estate and the financial sectors.

Accordingly, the Ministry of Industry and Trade – which represents the government ownership in Sabeco – has proposed to sell the stake either in a single tranche, worth about $1 billion, to reduce the government’s holding in it from 89.59 per cent to 36 per cent; or to sell in two batches of 40 per cent and 13.59 per cent.

The ministry seems to be in favour of the first option, reasoning that it could help Sabeco find more strategic investors, the person quoted above, who did not want to be named, added.

The Vietnamese government has valued the company at over $2 billion, and has said it is open to selling up to 53 per cent in the company to strategic investors. Sabeco has a 46 per cent market share in Vietnam, the country with the highest beer consumption per capita in ASEAN (35.5 litres per annum), as compared to just 16 per cent for Hanoi Beer Alcohol and Beverage Corporation aka Habeco, the second largest player.

Amidst these developments. the company’s chairman Phan Dang Tuat said that he would prefer Vietnamese firms becoming Sabeco’s strategic shareholders.

Speaking at Sabeco’s shareholder meeting on Thursday, Tuat said that nine companies have submitted applications to buy the Vietnamese brewer. Addressing the interest from ThaiBev, Tuat figuratively compared Sabeco to a “beautiful girl” and said that large firms such as ThaiBev were like handsome men, but the “marriage” between them will be decided by the local ministry.

“We should be cautious when working with large firms. Cooperation in the same industry can be beneficial, but the threat is that we might soon lose our brand. By all means, annexationism always exists in the business method of large companies,” he told shareholders.

Local businesses have more advantages, as the strategic investor criteria for the company, apparently requires that the partners support Sabeco in improving production capability and quality, but do not directly compete with the beer maker.

“We will host a game for qualified players, and sell to who offers the best price with the best promises for shareholders,” Tuat added.

The beverage business faced some difficulties last year due to the slump in the country, which led to a slowdown in consumption, said Sabeco general director Pham Thi Hong Hanh, who also spoke at the company’s shareholder meeting today.

She further added that concluding this fiscal year, Sabeco profit will grow by eight per cent to reach VND3.3 trillion ($153.5 million). However, Hanh also added that the possible forthcoming revision in special consumption tax might affect profit and the dividends for stakeholders.

Meanwhile, Sabeco will promote exports to the neighbouring markets of Cambodia, Laos, Myanmar, China and Korea. In addition, it will upgrade current factories while deploy investment in new plants.

Also read: Vietnam’s Sabeco prefers domestic investors for its share sale

Thai beer tycoon confirms interest in buying Vietnam’s Sabeco

Singha joins ThaiBev in race for VN’s SABECO

ThaiBev eyes Vietnam’s beer maker SABECO

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

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  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.