ThaiBev has much to gain locally and regionally if it gets majority
September 20, 2012 00:00
By KWANCHAI RUNGFAPAISARN
Thai Beverage stands to benefit substantially if it gains majority control over Fraser & Neave (F&N), as the Singapore-based drinks firm would be a key piece of the jigsaw in strengthening the Thai firm's beverage profile in the Kingdom while expanding i
Thapana Sirivadhanabhakdi, president and chief executive officer of ThaiBev, said during a recent interview with The Nation that the company had recognised that a takeover deal for F&N would be a win-win strategy for both companies.
It would lead to a complementary effort between major businesses in this promising part of Asia, he said.
Thapana said business synergy would be adopted allowing ThaiBev to distribute its beverages along F&N’s regional network, while introducing F&N beverages with potential into the Thai market.
F&N has three major businesses in its portfolio – food and beverages, properties, and publishing and printing.
For food and beverages, the company provides consumers around the world with an array of leading brands. In the soft-drinks portfolio are F&N Sparkling Drinks, 100Plus isotonic drinks, F&N Seasons Asian drinks and fruit teas, F&N Ice Mountain bottled water, F&N Fruit Tree juice drinks and F&N cordials.
F&N set up a Bangkok-based subsidiary, F&N Dairies (Thailand), in 2007 and operates two major factories in the Kingdom, located in Nakhon Ratchasima’s Pak Chong district and Rojana Industrial Park in Ayutthaya.
Its major products sold locally include Bear Brand sterilised milk, Carnation condensed milk, Tea Pot condensed milk, F&N Creation three-in-one coffee mix, Magnolia ChocMalt, and Magnolia pasteurised milk and whipped cream.
ThaiBev’s major non-alcohol beverages are Oishi ready-to-drink green tea, Chang drinking and soda water, Crystal drinking and soda water, Black Up ready-to-drink coffee, Fruit Net 100-per-cent fruit juice, Wrangyer and Ranger energy drinks, and Power Plus electrolyte beverage.
“We have considered ourselves a substantial shareholder in the Singapore firm. What the company has been doing with F&N was quite clear in the eyes of investors and the general public. The company has never played games, but is looking for long-term value creation with F&N,” said Thapana.
“Our past track record is clear, as we tend to support and create value in any company we have invested in. With F&N, we are looking to explore opportunities for our beverage business as the main objective. It is a quite natural investment, as we will have a pipeline of sequential business deals,” he added.
The executive said ThaiBev had been studying F&N for a long time. The company has a strong cash flow and a distribution network that has spread throughout the Asia-Pacific, providing ThaiBev with an opportunity to grow in the region.
Thapana said ThaiBev’s investment in Oishi Group was another clear example of a win-win strategy.
Oishi has enjoyed larger distribution coverage, especially in the traditional trade, with the support of ThaiBev.
ThaiBev last year acquired Serm Suk, a leading local logistics company, and will develop and provide returnable bottles for Oishi for its beverage products, especially green tea, he added.