CHINA: S&N mulls Chongqing investment
Scottish & Newcastle is looking to boost its stake in Chinese associate Chongqing Brewery Co. but reports of a plan to spend GBP100m (US$196m) are wide of the mark, just-drinks understands.
The UK's largest brewer, which bought a 19.5% stake in Chongqing Brewery two years ago, has seen its holding diluted to 17.5% as shares in the Chinese brewer have been issued to public shareholders.
Just-drinks understands that S&N could make a move this year to take its stake back up to 19-20%. However, reports in the UK suggesting that the brewer would pay GBP100m are believed to be over-stated.
S&N's interest in bolstering its stake comes as the state-owned Chongqing Beer (Group) Co. - the majority shareholder in Chongqing Brewery - plans to inject all of its brewing businesses into its listed subsidiary.
Chongqing Beer plans this year to list all of its brewing assets as it looks to boost sales in China's buoyant, but fledgling, beer market.
Chongqing Brewery is a key player in the south-west of China and dominates the local beer market in the city of Chongqing. The brewer holds 80% of the Chongqing beer market, which stands at around 4m hectolitres.
Its closest competitor in the region is SABMiller associate CR Snow Breweries, which is present in the neighbouring province of Sichuan.
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