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Caixin
Sep 12, 2019 08:49 PM
BUSINESS & TECH

World’s Biggest Brewer Restarts Hong Kong IPO for Its Asia Unit

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Cans of AB InBev's Budweiser on sale at a supermarket in Changzhou, East China's Jiangsu province on July 1, 2018. Photo: IC Photo
Cans of AB InBev's Budweiser on sale at a supermarket in Changzhou, East China's Jiangsu province on July 1, 2018. Photo: IC Photo

European brewer Anheuser-Busch InBev SA/NV (AB InBev) announced Thursday that it has resuscitated its application to list its Asia unit in Hong Kong, two months after pulling out of its previous plan.

The Belgium-based parent company said it has resumed the process for listing a minority stake of its Asia Pacific subsidiary, Budweiser Brewing Company APAC Ltd., on the Hong Kong Stock Exchange, but “no assurance can be given that this transaction will be completed and the decision to proceed will depend on a number of factors and prevailing market conditions,” it .

Sources familiar with the matter told Caixin that the IPO is expected to take place this month, with investors able to begin placing share orders as soon as next week.

AB InBev, known as the world’s biggest brewer, to raise as much as HK$67.3 billion ($8.59 billion) in July in order to repay its debts from an aggressive expansion, but later the same month decided to suspend the plan after receiving a cool response from the market.

The company that the decision was “due to several factors, including the prevailing market conditions.” Hong Kong has been suffering political and social turmoil since June, which lead the city’s government to announce the withdrawal of a controversial extradition bill earlier this month.

The resumption of AB InBev’s IPO could serve to boost market confidence in the Asian financial hub, analysts said.

AB InBev did not announce an indicative price range after resuming the IPO plan, so it remains to be seen what the valuation of its Asia-Pacific unit will be.

“The past two months may not necessarily change investors’ impression of the company, but AB InBev should learn from the past and approach the market more sensibly,” said a capital market analyst who works for an investment bank.

The July listing plan was expected to be the largest IPO of the year, but the valuation of the Asia-Pacific subsidiary is likely to shrink due to changes to its business over the past two months.

Shortly after pulling out of the listing, AB InBev sold its Australian operations on July 19 for $11.3 billion to Japanese brewer Asahi Group Holdings Ltd. The subsidiary’s operations are now mostly focused on Asia, with China as its top priority.

Contract reporter Isabelle Li (liyi@caixin.com)

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