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Vietnam’s largest brewer Sabeco mulls listing on southern bourse

Vietnam’s largest brewer Saigon Beer, Alcohol and Beverage Corp (Sabeco) is contemplating a listing on the Ho Chi Minh City Stock Exchange, where the country’s largest blue chips are currently listed, the local industry ministry said, in a document.

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“The ministry has reported to the government about its privatization plan for Sabeco four times since 2012, and the overall goal is to list the company’s stocks as the state capital is divested,” the Ministry of Industry and Trade said in a response to the Vietnam Association of Financial Investors, which favours state exit from commercial businesses.

“The ministry acknowledges that the delay in listing has disappointed investors. Therefore, it will ask the government for consideration of listing on the Ho Chi Minh City Stock Exchange,” it added. VAFI had earlier urged the government to accelerate the divestment in Vietnam’s two biggest beer firms, Sabeco and its Hanoi-based peer Habeco. Accordingly, the association expects the industry ministry, which represents the state holdings in these two enterprises, to act swiftly in selling significant stakes from almost 90 per cent (in Sabeco) and 82 per cent (in Habeco), to minority holdings.

The local government had indicated that it would bring down state ownership in a single tranche to 36 per cent in a move that would value the company at over $2 billion. This led to a lot of interest from international beverage companies in the state-owned firm.

A group of foreign bidders including Thai firms Thai Beverage and Singha Corp, along with US and Japanese brewers, had expressed keenness to pick a major stake in Sabeco.

However, Sabeco’s executives then said the company preferred domestic buyers given that several local businesses such as Saigon Securities Inc and Lien Viet Group had submitted bids.

VAFI’s general secretary Nguyen Hoang Hai opines that it does not matter if the buyer of Sabeco’s 53 per cent equity is a domestic or overseas company as long as sale process was transparent. In addition, it is important for Sabeco to have better corporate management, the association spokesman added.

Sabeco launched its IPO in 2008 and, since then, Heineken is the only major foreign shareholder with 5 per cent interest.

Sabeco is the largest producer of beer and beverage products in Vietnam, which has reported 3.4 billion litres of beer consumption in 2015. Habeco, the second largest player, reportedly has a market share of more than 17 per cent.

16 Aug. 2016

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