Anheuser-Busch InBev ( Part of Warren Buffett Holdings) said Friday that it’s selling 19.9 percent of China-based Tsingtao Brewery Co. Ltd. to Asahi Breweries Ltd. of Japan for $667 million.
Anheuser-Busch InBev said it will keep a minority stake of 7 percent in Tsingtao, China’s second-largest brewer.
Reducing its stake in Tsingtao allows the Belgium-based brewer to generate cash to repay debt incurred from its $52 billion purchase of St. Louis-based Anheuser-Busch Cos. Inc. in November.
Carlos Brito, A-B InBev’s CEO, said in a statement that the company remains “strongly committed” to China, the world’s largest beer market. “Our operations in Northeast and Southeast China are a key platform for our global growth strategy going forward. With strong local brands such as Harbin and Sedrin and global brands such as Budweiser, we are well positioned to benefit from the significant potential in this important market.”
Anheuser-Busch InBev said it currently doesn’t plan to sell additional Tsingtao shares and will review its strategic options as appropriate.
The sale agreement calls for Anheuser-Busch InBev to sell the shares at a premium of 38 against the closing price of H-shares as of Thursday. The deal is subject to approvals under Chinese and Hong Kong laws, and the companies expect to complete the transaction this quarter.
The sale will make Asahi Tsingtao’s second-largest shareholder. With a 31 percent stake, Tsingtao Brewery Group will remain the largest shareholder in Tsingtao.
St. Louis-based Anheuser-Busch is now a wholly owned subsidiary of the newly named Anheuser-Busch InBev. Anheuser-Busch is the top domestic competitor to MillerCoors, a joint venture of Canada's Molson Coors Brewing Co. and SABMiller of London. SABMiller competes in China primarily with its Snow brand, produced by its Chine Resources Snow joint venture.
As per Sep 08 shareholding pattern, Warren Buffet's Berkshire Hathaway is holding 13,845,000 shares of Anheuser-Busch .
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