Tug-of-war over Myanmar Brewery continues as MEHL disputes F&N’s desired exchange rate

The sale must take place at the present rate, says MEHL.

The dispute over Fraser and Neave (F&N)’s 55% stake in Myanmar Brewery (MBL) is set to continue even after an independent valuer said that the stake is worth 500 billion kyat.

Now, the two parties have locked horns over the exchange rate that should be used for the sale. F&N believes that the 2013 US dollar exchange rate must be used, which will translate to a fair value of $763m (US$560m).

However, Myanma Economic Holdings (MEHL) said that the present rate should be used, which is equivalent to $550m (US$401m).

“MEHL stands ready and willing to conclude the sale and purchase of F&N’s stake in MBL at 500 billion kyat within the 30-day period ordered by the arbitral tribunal,” said U Nay Wynn, Director of MEHL.

In 2013, MEHL commenced arbitration to seek an order that F&N was obliged to sell its stake in MBL to MEHL following F&N’s breach of obligations under their Joint Venture Agreement (JVA).

In October 2014, the arbitral tribunal allowed MEHL’s claim and ordered F&N to sell its 55% stake in MBL to MEHL or its nominee at a valuation to be determined by an independent third party valuer.