Looks like Heineken N.V. (AMS:HEIA) (PINK:HINKY) has pulled up its sleeves for a full buy-out of Asia Pacific Breweries. Kindest Place Group has a connection to ThaiBev, which purchased the shares from Oversea-Chinese Banking Corp. Limited (SGX:O39) and Great Eastern Holdings. Kindest Place bought the shares of APB in July, when ThaiBev was preparing for a takeover bid for Heineken’s APB partner, Fraser and Neave Limited (SGX:F99).
Kindest Place Group is owned by Chotiphat Bijananda, the son-in-law of Mr. Charoen, whose company, Thai Beverage Public Company Limited (SGX:Y92), has agreed earlier this week to buy a combined 22% stake in Fraser and Neave Limited (SGX:F99) for S$2.78 billion from OCBC and partners. After the acquisition of the 8.6 percent stake, Heineken’s direct holding in APB will be around 21.8 percent. Asia Pacific Investments, which is a joint venture between Heineken and Fraser and Neave Limited (SGX:F99), owns around 65 percent stake in APB directly. The Singapore conglomerate, Fraser & Neave, also has a 7.3% direct stake in the APB.
The deal from Heineken follows an agreement entered Tuesday, according to which, F&N’s shareholder, Thai Beverages, will support Heineken’s offer for APB, and will vote in favor of it at F&N’s upcoming shareholders meeting on Sept. 28. Heineken’s APB offer, which has already been cleared by F&N’s board, awaits a vote from shareholders on the 28th of September.
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The deal between Heineken N.V. (AMS:HEIA) (PINK:HINKY) and Kindest Place Group will be completed via the Singapore Stock Exchange at a date to be agreed on in the future, but not later than 1 October 2012.
A takeover of APB by the Dutch brewer will give it an edge over other rivals in Southeast Asia, as well as China. Beer consumption in 9 of the 10 Southeast Asian countries totaled 6.84 billion liters in 2011, up more than six percent from 2010, with Vietnam, Thailand and the Philippines leading the market, as data from research firm Euromonitor showed.
Barclays research further notes the required votes needed to have the deal passed:
Heineken has made an important announcement overnight regarding its takeover of APB (Asia Pacific Breweries). The company has now gained support from Thai Beverages, who will vote in favour of Heineken’s S$53 per share final offer for APB in return for Heineken agreeing to not make an offer for Fraser & Neave. This will allow Thai Bev to pursue its acquisition of F&N excluding the beer assets (eg, its property portfolio, food and soft drinks businesses) and virtually ensures Heineken will win over the attractive beer assets.
The APB EGM will be held on 28 September, where Heineken will require a simple majority from F&N shareholders to get over the line. With Thai Bev already owning 30%, and to say ‘Yes’, this implies an acceptance rate of only 29% is required from the remaining shareholders – hardly a stretch given the premium offered. Once the F&N stake is won, Heineken will own 81.6% of APB. It will then receive Thai Bev’s 8.6% direct stake in APB and the remaining free-float (9.8%) will be swept up given it will trigger the compulsory acquisition regulation in Singapore.