China National Radio reported on May 5 that shortly after Coca Cola's attempt to acquire Huiyuan, Tsingtao Beer, another national name brand product is facing a potential shift of ownership.
Anheuser-Busch InBev, currently Tsingtao Beer's second-largest single shareholder, announced recently that it would transfer its stocks in the Chinese beer company to Japanese brewery Asahi, totaling 19.9 percent of Tsingtao's entire shares. Hence, adding 7.09 percent of its current stakes in Tsingtao, Asahi will take possession of 26.99 percent of Tsingtao Beer, and becomes its 2nd largest shareholder, after Tsingtao Beer itself, whose presence in the company accounts for 30.89 percent.
With regard to this transaction, Tsingtao's PR department claims it is a normal function of the capital market. "Our stock shares are in circulation. The shift of shareholders should be regarded as normal business procedure, and is unlikely to affect our company's operation."
As China's Ministry of Commerce (MOC) imposes no limit to the foreign presence in Tsingtao Beer, Asahi is likely to gain another 3.99 percent and then take over the Chinese company. Currently, Tsingtao Beer has only 20 percent of the national beer market. Therefore, the MOC will have difficulty in justifying any opposition should there be an acquisition.
Among the three national leading beer breweries – Resources Snow, Tsingtao and Yanjing – two have foreign presence. Should Tsingtao Beer become Japanese, the national brand would further fade.
For more information, please consult the Chinese coverage at:
http://news.xinhuanet.com/fortune/2009-05/07/content_11326962.htm
(China.org.cn by Maverick Chen, May 7, 2009)
