Heineken's Thai rival makes bid for Tiger Beer parent

A Thai group on Thursday made an $8.7 billion ($7.1 billion) offer for Singapore's Fraser and Neave (F&N) group, the parent of an Asian brewer about to be taken over by Dutch giant Heineken. Thai Beverage (ThaiBev), controlled by billionaire Charoen Sirivadhanabhakdi, and its partner TCC Assets, also controlled by Charoen, said in a statement they were offering Sg$8.88 per share for the 70 percent of F&N shares they do not own. The all-cash offer came two weeks ahead of a general shareholders' meeting called by the F&N board to approve Heineken's Sg$5.6 billion offer for F&N's 40 percent stake in Asia-Pacific Breweries (APB), the makers of Tiger Beer and other popular Asian brands. Heineken already owns 42 percent of the brewer and a takeover would give it a major advantage in the Asian market, where beer consumption is booming as sales fall in mature markets like Europe. According to Forbes business magazine, Charoen is the third richest person in Thailand with an estimated fortune of $6.2 billion as of August with the bulk of his money coming from his beverage business. The Thai offer for F&N became mandatory after Singapore-listed ThaiBev and TCC Assets jointly crossed the 30 percent ownership level. "From a financial discipline perspective, ThaiBev has determined that it will not incur additional debt or expend any funds to acquire more F&N shares or to make an offer for F&N," it said in a filing to the Singapore Exchange. Thapana Sirivadhanabhakdi, chief executive of ThaiBev, said "we believe the offer represents an opportunity for F&N shareholders to realise the value of their investment in cash and to make a complete exit from F&N". "We hold F&N in high regard and we believe its long-established track record and success in its core businesses will be beneficial to our group". F&N's board had already recommended acceptance of the Heineken offer in a September 28 shareholders' meeting, but rumours of a ThaiBev bid this week had triggered speculation that F&N could be broken up to unlock value. Breaking up F&N would "allow for what might be seen as sensible release of shareholder value, to get the most out of the current structure", said Jason Hughes, head of premium client management for IG Markets Singapore. Other companies including big names in the beverage sector such as Coca-Cola and Kirin Holdings of Japan may snap up portions of F&N to expand their presence in Asia, he told AFP on Wednesday.