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CHINA: SABMiller's Snow wins Kingway Brewery's hand

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SABMiller appears to have won the race for Kingway Brewery Holdings, having agreed to buy the business for US$864m.

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The UK-based brewer confirmed this morning (5 February) that its Chinese JV with China Resources Enterprise, China Resources Snow Breweries, will acquire Kingway, which operates primarily in the affluent province of Guangdong in the country. Kingway is listed on the Hong Kong stock exchange, with state-owned GDH its controlling shareholder.

The brewery business comprises seven breweries, four of which are in Guangdong, with sites also in the Sichuan and Shaanxi provinces and Tianjin municipality. Total annual production capacity of the facilities stands at 14.5m hectolitres, according to SABMiller.

The move signals the end of the race for Kingway, which started back in 2011 when Asia Pacific Breweries, at the time a JV between Fraser & Neave and Heineken, sold its 21.4% stake in Kingway to GDH. Subsequently, GDH started a search for outside investment, with observers suggesting that Anheuser-Busch InBev, Beijing Yanjing Brewery Co, Carlsberg and CR Snow were showing interest.

“The acquisition of Kingway gives us greater access to high growth and attractive regional markets in China, thereby enhancing CR Snow’s competitive position,” said SABMiller's MD for Asia Pacific, Ari Mervis.

The transaction remains subject to regulatory approvals and final approval of Kingway's shareholders.


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