Fosun Group, one of China’s biggest buyers of overseas assets, has turned its sights back to its home turf, as it buys out a Japanese shareholder in one of the country’s oldest and biggest breweries…Full Article: South China Morning Post Dec 2017

Key Points

  • Fosun International (HKG:0656) will out Asahi Group’s stake in Tsingtao Brewery (SHA:600600) (HKG:0168) for HK$6.6 billion (US$844 million)
  • In 2016, 53% of Tsingtao Brewery’s (SHA:600600) (HKG:0168) sales were in Shandong Province. The next largest sales markets were North China (16% of sales), South China (13%), East China (11%), South-East China (6%), and Overseas (2%).

ChinaAg Comments

  • In October 2017, Asahi Group confirmed that it would be selling all or part of its stake (2nd largest shareholder) of Tsingtao Brewery (SHA:600600) (HKG:0168).
  • In July 2017, Fosun International (HKG:0656) and Beijing Sanyuan Food (SHA:600429) jointly purchased St Hubert, a French margarine producer, from Montagu Private Equity for approximately USD 702 million. France’s St Hubert annually sells ~35,000 MTs of butter spreads.
  • In June 2017, Asahi sold its remaining 20.4% share in instant noodle company Master Kong [see Tingyi Holdings]. In 2016, Asahi sold a 10% stake in the company.
  • In February 2017, Denmark’s Carlsberg A/S was considering purchasing a 20% stake of Tsingtao Brewery from Japan’s Asahi Group Holdings. A tie-up with Denmark’s Carlsberg may help Tsingtao Brewery compete with China Resources Beer Holdings’ Snow Beer and Anheuser-Busch InBev’s Budweiser beer.
  • In January 2017, Asahi Group announced it was selling off its Shandong-based farm and dairy business.
  • In 2016, Asahi, via its subsidiary, sold Shandong Asahi Green Source High-tech Farm to China’s New Hope Group.
  • In February 2015, Fosun International (HKG:0656) acquired a 20.45% stake in the state-owned dairy firm Beijing Sanyuan Foods Co., Ltd. (SHA:600429) for approximately CNY 2 billion (USD 325 million).
  • In 2014, China Resources’ Snow Breweries had a 23.8% market share (by volume) in China, followed by Tsingtao Brewery’s Tsingtao Beer at 18.4%, Anheuser-Busch InBev at 14.3%, Beijing Yanjing Brewery at 12.3%, and Carlsberg Group at 7.5%.
  • In March 2013, Tsingtao began constructing a brewery (~600,000 kiloliter capacity) in Luoyang, Henan province, which began operations in December 2013. In August 2013, another Tsingtao brewery (~400,000 kiloliter) began operations in Jiujiang, Jiangxi province.
  • In August 2009, Asahi Group bought 19.99% stake in Tsingtao Brewery from the Belgian-Brazilian company, ABInBev, for USD 670 million.
  • In 2008, Asahi launched its dairy business in the Shandong Province. The Japanese company imported dairy cows from Australia, but reportedly failed to make headway due in part to China’s underdeveloped cold chain logistics infrastructure.
  • Founded in 1992 and headquartered in Shanghai, Fosun International (HKG:0656) is a Chinese conglomerate with interests in real estate, finance, private equity, insurance, and tourism.
  • Founded in 1903 and headquartered in Qingdao, Shandong Province, Tsingtao Brewery (SHA:600600) (HKG:0168) was the first Chinese company to be listed in both mainland China (Shanghai Stock Exchange in 1993) and Hong Kong (listed in 1993).

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