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Its Huge Hong Kong IPO To Be Resurrected By The World’s Largest Brewer


09/12/2019


Its Huge Hong Kong IPO To Be Resurrected By The World’s Largest Brewer
The global brewing giant Anheuser-Busch InBev is set to revive its earlier announced and later stalled plans of launching of an initial public offering for its Asia business at the Hong Kong stock exchange. The company has resumed its application for the listing after it had stalled the process two months ago for an IPO that would have been the largest public offering for the year.
 
There is no certainty that the transaction will go through "and the decision to proceed will depend on a number of factors and prevailing market conditions", said the largest brewer of the world in a statement on Thursday.
 
This year has been troubling one for Asian stock markets so far – primarily because of the acrimonious and prolonged trade war between the United States and China. There has been a 5.1 per cent drop since start of July in Hong Kong's Hang Seng Index primarily because of a continued political unrest wherein there has been weekend mass protests by pro-democracy activities in the island city for months.
 
Through the listing Budweiser Brewing Company APAC, the largest brewer in Asia by retail sales, AB InBev was hoping to raise as much as $9.8 billion in funds. The company however had pulled out of the IPO which was planned for launch in July.
 
Had the IPO gone through, it would have been greater in value than that of the US ride hailing company Uber which managed to gather funds of $8.1 billion at the New York stock exchange in May this year.
 
The funds generated from the IPO could be used by AB InBev to bring down the massive debt that it currently faces. The company cut its dividend last year and in July had sold off its Australian business for $11.3 billion which has helped the company to already steady its balance sheet.
 
AB InBev had incurred debts form the market to finance a series of acquisitions with its plans to become the largest brewer of the world. The debt of the company reached a staggering $102.5 billion in 2018 with its mega purchase of SABMiller.
 
According to experts, the company would be helped in its business in China, the largest market for beer in the world, because of its Asian IPO. There was a 8.3 per cent increase in the sale of AB InBev in 2018 in Chinese market and its global brands such as Budweiser and Corona  were the outstanding performers.
 
The AB InBe’s Asian business’ public launch would also be a big positive for the Hong Kong Stock Exchange. According to reports last month, Chinese tech giant Alibaba plans to postpone its mega plan to raise $15 billion through a secondary listing in Hong Kong. The reports blamed the ongoing political unrest in the city for the decision of the company. There has so far not been any comment from Alibaba.
 
(Source:www.cnn.com)


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