Budweiser planning second IPO attempt for its Asian business


Two months ago, the parent company of Budweiser (NYSE: BUD) made a major attempt in trying to go public with a major blockbuster listing in Hong Kong.

While the plan was eventually called off before the major Hong Kong protests first came about, it turns out that there’s going to be another major attempt to go public, this time offering a slimmed-down version of their previous IPO.

European beer giant Anheuser-Busch InBev, the parent company of Budweiser, started pitching a trimmed-down version of its Asian business to investors in the city in the hopes that they will be able to pull off a smaller IPO this time round in the coming weeks. Their Asian Budweiser division is expected to raise $5 billion in a public offering that would be finalized by the end of September, according to anonymous sources that spoke with the Wall Street Journal.

The specifics of the sale are likely to come about sometime next week as the public offering gets formally launched for the second time now. Budweiser is planning to line up a number of major investors and institutions that could be interested in buying a chunk of the brewer’s stock.

The timing of the offering coincidences with a slowdown in the ongoing Hong Kong protests. The capital markets of Hong Kong have been recovering from the summer’s protests which still have caused lingering business disruptions alongside having dragged down the price of various stocks. However, experts on the matter remain optimistic that there’s going to be a pickup in deal activity in the weeks and months to come.

Previously, parent company Anheuser-Busch InBev called of a larger $10 billion listing, blaming the market conditions at the time as being far too unfavorable. If the listing would have continued, it would have been Hong Kong’s biggest IPO. Many investors at the same said that they were deterred by the steep valuations that the company was hoping for.

“It’s not immediately clear why (AB InBev) is in such a rush to complete the IPO following the Australia deal,” said Bernstein Research analysts in a note. They added that perhaps the company is trying to take advantage of high beer valuations in Chinese rivals or that maybe there’s already an acquisition deal planned for its Asian Budweiser business.

Shares of Budweiser stayed relatively the same in the New York Stock Exchange, inching up just 0.07%. In Europe, however, shares of the company are up 4 percent at the time of writing. Over the past few months, shares of Budweiser have been steadily rising, growing by almost 50 percent since early January.

Budweiser Company Profile

Anheuser-Busch InBev SA/NV is the largest brewer in the world and one of the world’s top five consumer product companies, as measured by EBITDA. After the SABMiller acquisition, the company’s portfolio now contains five of the top 10 beer brands by sales and 18 brands with retail sales over $1 billion.

AB InBev was created by the 2008 merger of Belgium-based InBev and U.S.-based Anheuser-Busch. The firm holds a 62% economic interest in Ambev and in 2016 acquired SABMiller. – Warrior Trading News