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AB INBEV CALLED OFF HONG KONG IPO BECAUSE OF WEAK DEMAND

By Staff Reporter

15-7-2019



The world’s biggest brewer Belgium’s Anheuser-Busch InBev (AB Inbev) has called off listing its Asia-Pacific subsidiary in Hong Kong citing prevailing market conditions.

The Hong Kong IPO of the Asia-Pacific unit, Budweiser Brewing Company APAC, would have been the world’s biggest IPO so far this year. The unit has a portfolio of over 50 beer brands including Budweiser, Stella Artois, Corona and Hoegaarden.

The company was planning to sell 1.6 billion primary shares at between HKD40 and HKD47 (USD5.13 and USD6.02) per piece, seeking to raise between USD8.3 billion and 9.8 billion in Hong Kong on 19 July.

“The company is not proceeding with this transaction due to several factors, including the prevailing market conditions,” Belgium-based AB InBev said on Friday.

“The company will closely monitor market conditions, as it continuously evaluates its options to enhance shareholder value, optimise the business and drive long-term growth, subject to strict financial discipline.”

According to some analyses, demand for the new shares was weak because of the relatively high valuations AB Inbev was seeking.

The company had hoped the listing would allow it to cut more deals in Asia and reduce its debt load, which stood at more than USD100 billion at the end of last year after a string of acquisitions.

Chief Executive Carlos Brito said in May that the company could meet its debt-reduction goals with or without the Asia IPO.

The move is a blow to Hong Kong, which has been struggling to win IPOs by big international companies in the midst of a trade war between China and USA.

The Asian financial hub is also tainted by political instabilities as a result of the continuing protests against the controversial extradition bill.

(the writer can be contacted at: info@thewinechronicle.com)

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