E-Malt.com News article: 3757

Philippines San Miguel Corp., Southeast Asia's largest food and beverage firm, said it was considering business acquisitions outside Asia after a newspaper said it planned to widen its expansion programme to the United States. The Philippine Daily Inquirer, citing an unnamed company official, reported on Tuesday, November 30 that San Miguel was studying the possible acquisition of an American company with an annual turnover of $5 billion.

"The company confirms that in line with its expansion programme, it is studying opportunities not only in Asia-Pacific but even in other countries," the company said in a disclosure to the stock exchange. "We will make the appropriate disclosure when definitive agreements are entered into."

San Miguel group, 15 percent owned by number-two Japanese brewer Kirin Brewery Co., dominates its home market in beer, liquor, soft drinks, food and poultry products.

On Nov. 23, it announced that it formed a joint venture with a Thai Life Group unit to build and operate a distillery business in Thailand. Thai Life, a leader in the Thai insurance market, will own 50 percent of the joint venture while San Miguel will have a 40 percent stake. The remaining 10 percent will be held by minority shareholders. The deal was the latest leg of a multi-million dollar expansion by San Miguel to boost its presence in seven Asia-Pacific countries.

This year, San Miguel signed a lease for a drinks factory in Vietnam, paid $102 million to buy a Thai brewery, bought a 50 percent stake in Australia's top juice maker Berri Ltd, and formed a joint venture with a Singapore coffee business.

It also started building a multi-product manufacturing facility in Indonesia and acquired for $35 million the packaging business of a unit of Malaysia's Hong Leong Industries.

San Miguel earns only 15 % of its revenues from overseas operations: four breweries in China and one each in Australia, Vietnam and Indonesia. The regional expansion is expected to increase this contribution to 60-70 percent. San Miguel believes the global market presents opportunities for it as the Philippine economy gives it little room for growth. In the Philippine beer market, San Miguel already controls 95 %. It is also the most dominant group in the food and soft drinks businesses.


01 December, 2004