05:46 (GMT +7) - Saturday 19/09/2020


Australia's CUB eyes Vietnam's top two brewers

Released at: 19:40, 25/07/2017

Australia's CUB eyes Vietnam's top two brewers

Photo: Infonet

Sabeco and Habeco expected to equitize later this year.

by Quang Huy

Australia’s leading brewer, Carlton & United Breweries (CUB), has said it wants to acquire shares in the Saigon Beer Alcohol Beverage Corp. (Sabeco) and the Hanoi Beer Alcohol Beverage Corp. (Habeco), the biggest brewers in Vietnam.

Mr. Jan Craps, CEO of CUB, said the company wants to become a strategic investor of Vietnam’s two prized brewers to cash in on the increasing amount of beer being consumed in the country.

CUB also has plans to expand its brewery in southern Binh Duong province, Mr. Craps told Deputy Prime Minister Vuong Dinh Hue during his visit to Australia on July 24.

Founded in 1907, CUB accounts for 47 per cent of Australia’s beer market share. It became a subsidiary of Belgian brewer AB InBev in October last year.        

Both Sabeco from Ho Chi Minh City and the Hanoi-based Habeco will submit plans to the government this month on their equitization process, with stakes slated to be sold later this year, an official from the Ministry of Industry and Trade (MoIT) told local media last week.   

MoIT valued its 89.59 per cent holding in the country’s top brewer, Sabeco, at $1.8 billion last August. The 82 per cent holding in Habeco is valued at $404 million, MoIT estimates.

Sabeco’s shares have increased 11 per cent over the last week on the back of news about the timing of its equitization, while Habeco’s jumped 8.7 per cent. Denmark’s Carlsberg, which owns 17.51 per cent in Habeco and says it has first right of refusal on the stake, has been in tense talks with the ministry about the sale.

An expanding middle class and youthful population have helped drive a 300 per cent surge in beer demand since 2002, according to Euromonitor, which estimates the market was worth VND147.2 trillion ($6.5 billion) in 2016. It predicts per-capita consumption will reach 40.6 liters this year, making Vietnam the biggest consumer of the amber fluid in Southeast Asia.

“Vietnam will be the market to watch,” Euromonitor said in a July report on the beer market in the Asia-Pacific region. “Thanks to the strong street consumption culture and rapid urbanization, Vietnam is forecast to see the largest volume growth in the 2016-2021 period.”

As competition intensifies among brewers, more aggressive promotions and new product launches will lead to even higher demand for beer, the report said. Carlsberg and the Netherlands’ Heineken have been fighting for share in Vietnam, driving beer sales “through the roof,” it said.

The government is now trying to slow the flow. A special consumption tax aims to increase the excise tax on beer annually, to 65 per cent in 2018. The National Assembly is considering proposals to turn off beer taps during lunch time and late in the evening. It is also weighing up whether to prohibit the sale of alcohol to pregnant women and to ban government employees from drinking during work hours.

User comment (0)

Send comment