Heineken: the battle for Asia Pacific Breweries

Introduction
Asia Pacific Breweries is Heineken’s joint venture in Singapore, with a variety of brands and consumer beverages that enjoy prominence in their local markets. The venture is crucial to the firm's growth strategy. This has been compromised following a competitor acquiring shares in the partner firm. Heineken considers this a threat, and wants to gain full control of the venture.

Scope of this research
MarketLine Case Studies describe topics such as innovative products, business models, and significant company acquisitions. Fact-based and presented in an accessible style, they explain the rationale of commercial decisions and illustrate wider market and economic trends. Research and analysis highlights
Heineken is the world's third largest beer producer, behind Anheuser-Busch InBev and SABMiller.

Asia Pacific Breweries' growth saw a compound annual growth rate of 13.4% from 2007 to 2011 as revenues jumped from S$1.78bn ($1.42bn) to S$2.97bn ($2.37bn). Net income went from S$263.1m ($209m) to S$341.7m ($271.9m), a 29.9% increase.

Asia Pacific remains an untapped market for the big three brewers, contributing to earnings before interest and tax by approximately 2% for Anheuser-Busch InBev and SABMiller, and 7% for Heineken.

Key reasons to purchase this research
Why has Heineken moved to fully control Asia Pacific Breweries? What are the implications of the deal for the Asia Pacific region?

Table of contents

Overview
Catalyst
Summary
Analysis
Heineken and Asia Pacific Breweries
Heineken is one of the largest brewing companies in the world
Asia Pacific Breweries is a prominent Heineken joint venture
F&N: the other partner in APB
Heineken's growth strategy
Advancing brands is central to growth
Access to emerging markets is a key objective
Heineken's activities in Asia Pacific could secure future dividends
ThaiBev's interest has sparked a battle for APB's control
APB's success has attracted interest within the region
The deal has regional implications
Conclusions
Heineken must win control of APB to secure its position
Appendix
Definitions
Sources
Further reading
Ask the analyst
About MarketLine
Disclaimer

TABLE OF FIGURES
Figure 1: Global beer market share, by volume (%), 2010
Figure 2: APB's revenues (S$), 2007–11
Figure 3: Tiger beer, one of APB's most successful products
Figure 4: Heineken's sponsorship of the UEFA Champions League

LIST OF TABLES
Table 1: Heineken's revenues and net income, 2006–11
Table 2: Global beer market share, by volume (%), 2010

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By company: Heineken