Japan’s Asahi Group has announced it may sell all or part of its 19.99% stake in Tsingtao Brewery, which is worth around $1.2 billion, as it focuses on growth in Europe.
Asahi said it the decision reflects its ambition to leverage strength in the Japanese market, where it is the largest brewery, as well as establish ‘a unique position as a global player’.
The stake was originally acquired in 2009 for around $666 million. However, Tsingtao has increasingly struggled with changing Chinese consumer taste for premium drinks and the increased presence of foreign competitors such as AB InBev in the country.
On Friday morning, investors responded favourably to the news, with Asahi shares up 2% and Tsingtao up 6% in Hong Kong.
In a statement, Asahi said: “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.
“As a result of our review of our investment in the beer business in China during the course of such process, we decided to commence an evaluation of a potential transfer of all or part of our stake in Tsingtao Brewery.”
In June, Asahi said it would sell its remaining 20.4% stake in Tingyi-Asahi Beverages for $612 million as it continues to shed assets in Asia.
In the company’s first-quarter results earlier this year, Asahi posted a 19.8% increase in profit on the same period last year following on from its completed acquisition of Miller Brands UK.
© FoodBev Media Ltd 2018