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Singapore’s Asia Pacific Breweries (APB) announced on June 16 it would consider raising its stake in Guangdong Brewery Holdings in the wake of the recent level of interest international brewers have been showing in the mainland beer market. “We are not unhappy with our current stake,” said Koh Poh Tiong, chief executive officer and director of APB. “If additional stakes are available, we will consider it,'' he said at the company's annual meeting on June 15, according to The Standard.

Heineken Asia Pacific Breweries China, a 50-50 venture between Singapore's APB and Heineken, acquired a 21.5 % stake in Guangdong Brewery this year. Ye Xuquan, chairman of Guangdong Brewery, said despite Beijing's recent efforts to cut government ownership in state-owned enterprises, the Guangdong provincial government has not indicated any interest in reducing its stakes in the mainland's 12th largest brewer. “The Guangdong government's participation in state-owned enterprises is lower ... compared with the northeastern parts of China,” said Lilian Leung, an analyst with ING Financial Markets.

Guangdong Brewery is 53 % owned by Guangdong Investment, the investment arm of the Guangdong provincial government. “It may not happen in the near future but possibly in the longer term,” said Fan Cheuk-wan, deputy head of China research at ABN Amro.

Stephen Fung, chief financial officer of Guangdong Brewery, said turnover grew 38 % in the first five months this year compared with the same period last year. Ye said while the company has just 1.1 % of the beer market, its share of profits made by all mainland brewers last year was 5 per cent. Fan attributed the anomaly to the higher prices beer commands in affluent Guangdong. She said Guangdong Brewery sells its beer for HK$2,500 per tonne, HK$1,000 above the national average. Ye said the company would keep its beer prices unchanged from last year, despite increasing competition.

China's Guangdong Brewery Holdings Ltd gained 6.67 percent to HK$1.92 after Singapore's Asia-Pacific Breweries Ltd was reported as saying that it was considering upping its stake in the Chinese beer maker.


18 June, 2004