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Beerworkers Archive


Post date: 12/07/2010 - 17:27

Tsingtao Brewery Co.will acquire Shandong Xin Imm

Tsingtao Brewery Co., the Chinese beer company founded by German settlers more than a century ago, will acquire Shandong Xin Immense Brewery Co. for 1.87 billion yuan ($281 million). The stock rose the most in three months in Hong Kong trading.

Tsingtao will pay cash to purchase 100 percent of its smaller rival, which brews and sells beer in China’s eastern Shandong province, according to a statement to Hong Kong’s stock exchange.

Tsingtao Brewery Co., the Chinese beer company founded by German settlers more than a century ago, will acquire Shandong Xin Immense Brewery Co. for 1.87 billion yuan ($281 million). The stock rose the most in three months in Hong Kong trading.

Tsingtao will pay cash to purchase 100 percent of its smaller rival, which brews and sells beer in China’s eastern Shandong province, according to a statement to Hong Kong’s stock exchange.

Shandong owns the “Silver Wheat” brand and had profit before tax in the first 10 months this year of 121 million yuan on sales of about 400,000 liters of beer, Tsingtao said in the statement. Tsingtao reported beer production of 5.9 billion liters last year, trailing the 8.37 billion liters posted by China Resources Enterprise Ltd., the Chinese government-backed partner of SABMiller Plc.

Tsingtao is “consolidating its dominance in Shandong province, one of China’s biggest beer markets,” Olive Xia, a Shanghai-based equity analyst at Core Pacific Yamaichi, said in a phone interview today. “We expect more acquisitions as consolidation will accelerate in the Shandong area,” said Xia, who recommends buying the brewer’s stock.

Tsingtao gained 5 percent to HK$42.95 in Hong Kong trading, the most since Aug. 30. The benchmark Hang Seng Index rose 0.8 percent. The beermaker had lost 5 percent of its market value in the year through yesterday, compared with a 6 percent gain for the benchmark.

The brewer’s Shanghai-traded shares remained halted.