Budweiser brewer tops SAB's bid for Harbin

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The Independent Online

Anheuser-Busch bid $720m for Harbin Brewery yesterday after raising its stake in the Chinese beer maker, topping a hostile $550m offer from its rival brewer SABMiller.

Anheuser-Busch bid $720m for Harbin Brewery yesterday after raising its stake in the Chinese beer maker, topping a hostile $550m offer from its rival brewer SABMiller.

The maker of Budweiser beer boosted its holding in Harbin from 29 per cent last week to 37.4 per cent, which triggered a full bid under Hong Kong rules. Anheuser-Busch is offering HK$5.58 a share, the same price it paid to lift its Harbin stake.

Harbin shares, which have jumped nearly 60 per cent since SABMiller and Anheuser-Busch first locked horns over the company early in May, were suspended yesterday ahead of the announcement.

Global brewers have been pouring money into beer makers in China, the world's largest market by volume, but where the average person drinks just 19 litres of beer a year. This compares with 50 litres in Japan and 84 in the United States.

Anheuser-Busch's offer values Harbin at 35 times forecast 2004 profits, prompting some analysts to question the price it is offering. Herbert Lau, at Celestial Asia Securities, said: "Harbin is just a regional brewery. It isn't worth that much." But the US brewer's high bid and its increased stake made it tougher for SABMiller to make a rival bid.

SABMiller would not walk away empty-handed. If it sells its stake to Anheuser-Busch at HK$5.58 a share, it would pocket a profit of $124m on its investment in Harbin. Reuters

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