F&N bidding war continues

The latest is ThaiBev's $7.2 billion cash offer.

IG Markets Singapore reported:

The big news in Singapore today is the Thais $7.2 billion cash offer for Fraser & Neave which was announced early this morning. There is a strong chance the purpose of the bid is to scupper Heineken's bid to acquire Asia Pacific Breweries. Whatever its intentions, it will definitely create some uncertainty among F&N shareholders as they head to the September 28 EGM.

ThaiBev have been a bit secretive in what their true intentions are and this bid sheds no real light on what these are. ThaiBev may still want to sell F&N’s APB share to Heineken and use the money to purchase F&N and then break it up. They also may want to take control of F&N to stop it selling its APB stake to Heineken. Both scenarios have equal probability.

There has been talk of ThaiBev now being interested in the non-beverage side of F&N as it owns more than $8 billion of properties and hospitality ventures. If it took control of F&N it would probably want to break the conglomerate up and sell it off.

But we still think ThaiBev is more interested in the alcoholic business of F&N, of which APB is the jewel in the crown. It would hate to see Heineken gain control of this and increase its foothold in Asia at ThaiBev’s expense.