Asahi announced a JV in Indonesia yesterday

Asahi announced a JV in Indonesia yesterday

Asahi Group's attempts to catch up on domestic rivals in the global market may heat up as cash flows increase and home growth is squeezed, an analyst has said.

The Japanese brewer yesterday (9 July) announced a US$213m JV with PT Indofood CBP Sukses Makmur to make non-alcoholic drinks. But, despite a string of partnerships with local partners outside of Japan, Asahi still lags Suntory and Kirin in revenue from overseas operations, Torsten Stocker, a partner at consulting firm Monitor Group, told just-drinks.

“Buying overseas businesses or entering JVs with a strong local partner has been a fairly typical expansion path for these players, rather than setting up their own operations to build their brands overseas,” Stocker said. 

“They have been pursuing this strategy for the past ten to 15 years, but it has taken a new sense of urgency recently, as growth in Japan is very hard to come by, and almost always means taking share from a rival, given the mature domestic economy. 

“On top of that, this strategy has been helped by the cash flow the Japanese players generate in their home market and the strength of the yen.”

Asahi is partnered with Schweppes in Australia and has a JV in China with Tingyi, Stocker said. It also acquired Malaysian Pepsi bottler Permanis last year, he said.

However, other players have been active as well. Kirin has a stake in the Philippines' San Miguel Brewery and in Singapore's Fraser & Neave. Suntory purchased Orangina Schweppes Group in 2009 and last month announced a JV with Chinese brewer Tsingtao.