ThaiBev: Planning spinoff of BeerCo

Chang Beer, made by Thai BeverageChang Beer, made by Thai Beverage

Thai Beverage (ThaiBev) is proposing a spinoff of as much as 20 percent of its BeerCo after shelving its previous attempt in 2021, the beer and soft drink maker said in a filing to SGX Thursday.

“The board sees significant growth potential in the beer business and believes that the potential can better be developed with a dedicated board of directors and management team focused solely on growing the beer business,” ThaiBev said in the filing.

In addition, BeerCo will have direct access to debt and equity markets and will be able to access more funding options to fund existing operations and expansion, ThaiBev said.

ThaiBev said it would use some of the proceeds of the spinoff to repay debt.

In February 2021, ThaiBev received a no-objection letter from Singapore Exchange Securities Trading (SGX-ST) for the potential listing of the beer business, the filing said. ThaiBev said it has now received confirmation from SGX-ST that the letter still applies.

BeerCo is a Singapore-based investment holding company which consolidates nearly all of ThaiBev’s beer business and operations, with the exception of the sale of Thai beer products outside Thailand, the filing said. The international beer sales business will still be operated by the ThaiBev group after the potential spinoff, the filing said.

BeerCo’s operations include producing, distributing and selling beer, including the Chang, Archa and Federbrau brands, in Thailand, and Bia Saigon and 333 in Vietnam, ThaiBev said, adding BeerCo has three breweries in Thailand and 26 in Vietnam.

For the fiscal year ended 30 September 2021, BeerCo posted revenue of around S$4.21 billion and profit after tax of S$342.5 million. BeerCo contributed 29 percent of ThaiBev’s profit after tax in the 2021 fiscal year, the filing said.

ThaiBev said it won’t hold a general meeting for shareholder approval of the spinoff.