Asahi Breweries, Lucio Tan firm eye tie-up
Initial venture on distribution of premium beer
Asahi Breweries of Japan is in talks with the Lucio Tan group on a strategic partnership in the beverage business, beginning with the distribution of premium beer and possibly expanding into manufacturing and even an investment in Asia Brewery.
Inquirer sources said that Asahi Brewery and Tan’s Asia Brewery started exploratory talks on a potential business partnership a few years ago, with Asahi keen on entering the Philippine market similar to the route taken by Kirin Holdings in its entry in San Miguel Brewery.
Michael Tan, president of Tanduay Holdings, which will consolidate all major businesses of the Lucio Tan group, confirmed Asahi’s interest. However, Tan said a distribution deal was all that the parties would establish for now.
“There are other interested parties, not just Asahi,” Tan said when asked whether Asahi would likely be a partner in the liquor business.
Other sources from the Lucio Tan group said Asahi had long expressed interest to invest in the local group’s liquor business but that the tycoon’s group would like to consolidate first the beverage operations of Asia Brewery and Tanduay Distillers.
Tan said at the sidelines of Tanduay Holdings’ recent stockholders’ meeting that for now, the group would focus on an importation and distribution deal with Asahi. In a separate chat with reporters later, he said the group had signed up a deal to import and distribute locally Asahi Super Dry beer, reportedly the best-selling beer in Japan.
“It’s the best beer. Super Dry will be in cans and in bottles and will be premium-priced,” Tan said. He said the group would likely start with the importation of about 20,000 to 30,000 cases of Asahi Super Dry beer a month.
Other sources said Asahi was also looking at opportunities in local manufacturing and has explored the possibility of a partnership with the Lucio Tan group.
Asahi has been expanding in the Asia-Pacific region. Only Last July, Asahi teamed up with a local Indonesian group to set up manufacturing and marketing units for non-alcoholic beverages in Indonesia. Last year, Asahi also invested in the beverage business in Australia and New Zealand as well as in a soft drinks company in Malaysia.
One source from the LT group said the beverage business might be the next core business in which a strategic partner would be taken in similar to how San Miguel Corp. was brought into Philippine Airlines and Philip Morris International into Fortune Tobacco. The group ceded management control of the businesses to these partners.
But to unlock better values from the beverage business, the source said the operations of Asia Brewery and Tanduay Distillers would have to be consolidated before taking in a new investor—whether it’s Asahi or another group. The source said all sales and marketing operations as well as bookkeeping, sales and inventory have now been merged. Only the production side has yet to be consolidated.
Another source explained that the strategy was to form “strategic collaboration” to strengthen core businesses. However, as no definitive deal has been agreed upon with Asahi outside of distribution, the source said the group would still be open to scout for other potential partners. Liquor, however, would still be part of the core businesses of the future LT Group Inc.
Disclaimer: The comments uploaded on this site do not necessarily represent or reflect the views of management and owner of INQUIRER.net. We reserve the right to exclude comments that we deem to be inconsistent with our editorial standards.
To subscribe to the Philippine Daily Inquirer newspaper in the Philippines, call +63 2 896-6000 for Metro Manila and Metro Cebu or email your subscription request here.
Factual errors? Contact the Philippine Daily Inquirer's day desk. Believe this article violates journalistic ethics? Contact the Inquirer's Reader's Advocate. Or write The Readers' Advocate:
c/o Philippine Daily Inquirer Chino Roces Avenue corner Yague and Mascardo Streets, Makati City,Metro Manila, Philippines Or fax nos. +63 2 8974793 to 94