SABMiller Makes Formal Takeover Bid For Harbin
Brewery
South African-based international beer conglomerate SABMiller
has made a hostile bid for the 71% of Harbin Brewery it
does not already own. The company is offering to pay 4.30
HK dollars (55 U.S. cents), or 14% below Harbin Brewery's
Friday closing price of HK$4.975 on the Hong Kong stock
exchange.
SABMiller and Anheuser-Busch are currently embroiled
in a takeover
contest for Harbin Brewery, as Anheuser-Busch recently
purchased another 29% in Harbin. This set the stage for
a three-way battle, in which Harbin's management sees
Anheuser-Busch as the white knight. Earlier on, the comments
made by the Harbin CEO had caused the company's shares
to be suspended from trading in Hong Kong. This is the
first time that a Chinese state-owned enterprise has become
the object of a hostile takeover by two non-Chinese companies.
SABMiller has aligned itself with China Resources and
its brewers; Harbin has said that the company has not
dedicated any resources to helping the company since its
purchase of the 29% stake.
In a further move to win government support, SABMiller
promised not to lay off any Harbin workers if its takeover
plan goes through. Northeast China, where Harbin is located,
is home to many large Chinese state-owned manufacturers
which have fared poorly during China's current phase of
economic readjustment and privatization. In some areas,
the unemployment rate is as high as an unofficial 50%.
For this reason, commitments not to lay off any workers
are especially welcome with the government.
The cash offer is set to expire on June 21.
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