Thai Bev Says “Party Acting in Concert” Exploring F&N Bid
Thai Beverage Pcl (THBEV) said it’s cooperating with an entity that may bid for Fraser & Neave (FNH) Ltd., potentially creating a hurdle in Heineken NV’s (HEIA) plan to take over an Asian brewer. F&N rose to the highest since at least 1984.
“A party acting in concert” with the Thai brewer is exploring the possibility of an offer for F&N, said Thai Beverage, controlled by billionaire Charoen Sirivadhanabhakdi, in a statement to Singapore’s stock exchange today.
Heineken will need approval from F&N shareholders for its S$5.4 billion ($4.4 billion) offer for the Singapore-based company’s 40 percent stake in Tiger beer maker Asia Pacific Breweries Ltd. (APB) this month. ThaiBev already has a 29 percent stake in F&N, according to data compiled by Bloomberg, and any controlling shareholders would be able to influence the deal. After selling the brewing stake, F&N will still own businesses ranging from soft drinks to serviced apartment buildings.
The potential bidder is probably one of Charoen’s companies, said Goh Han Peng, analyst at DMG & Partners Research Pte in Singapore. Goh said it could also be a brewer or developer interested in F&N’s real estate operations.
“Anything close to a 50 percent stake would allow them to block Heineken,” he said.
Fraser & Neave shares rose 1.3 percent to S$8.66 at the close in Singapore, the highest since at least January 1984. Vichate Tantiwanich, a spokesman for ThaiBev, in a text message in response to questions declined to name the party the company is working with.
“We have noted ThaiBev’s statement,” said Heineken spokesman John Clarke in an e-mailed statement. “Heineken is not in a position to comment on what they may or may not do in the future.” The brewer’s “focus” remains on the Sept. 28 F&N meeting when shareholders will vote on the APB deal, he said. Heineken shares fell 0.2 percent to 43.245 euros as of 12:19 p.m. in Amsterdam trading today, set for the lowest in more than three weeks.
Fraser & Neave got about 30 percent of its 2011 revenue of S$6.3 billion from its property division, about 12 percent from soft drinks and 17 percent from dairies, according to data compiled by Bloomberg. Charoen’s unlisted business TCC Group has a real estate arm and Thai Beverage sells non-alcoholic drinks in addition to beer and spirits.
“There is no certainty that an offer for F&N will materialize,” ThaiBev said in its statement. The brewer said it’s not seeking funding for a general offer for F&N, and it’s instead getting refinancing proposals for a loan taken to finance an earlier investment in the Singapore company.
Heineken, the world’s third-biggest brewer, in August raised its offer for a controlling stake in APB to S$53 a share from S$50. The Dutch brewer has sought full control of APB as it attempts to protect its hold over a key emerging-markets business and as brewing assets in high-growth economies are in short supply after a decade of consolidation in the industry.
Kindest Place Groups Ltd., controlled by Charoen’s son-in- law, has an 8.6 percent stake in APB, according to data compiled by Bloomberg.
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