AB InBev has revived its failed IPO in Hong Kong by offering 1.26 billion shares of a minority stake of its Asia Pacific subsidiary, Budweiser Brewing Company Apac. File Photo: IOL
DURBAN – Anheuser-Busch InBev (AB InBev) has revived its failed initial public offering (IPO) in Hong Kong by offering 1.26 billion shares of a minority stake of its Asia Pacific subsidiary, Budweiser Brewing Company Apac, and the world’s largest brewer is hoping to raise $5 billion (R74.4bn) on listing.

AB InBev has priced its Budweiser IPO at HK$27 (R51.24) a share and the group said on Wednesday that it intended to apply all of the net proceeds from the offering to repay its debt.

AB InBev’s debt escalated when it acquired SABMiller, for $100bn in October 2016. The group shelved the IPO of its Asian business in July, in which it hoped to raise up to $9.8bn, due to several factors, which included the “prevailing market conditions” at the time. The owner of brands such as Corona, Budweiser and Stella Artois, said at the time that it would evaluate its options in the near future.

The group has more than 500 brands across the globe. With the IPO back on track, the group has created a room for an over-allotment option to cover market demand.

“The company has also partially exercised an offer size adjustment option, issuing an additional 189.35 million shares for a total of 1.45 billion shares to cover demand.

The group added the IPO is also subject to an over-allotment option of up to 217.76 million additional shares at the same offer price and the shares are expected to start trading at the end of September on the Main Board of The Stock Exchange of Hong Kong, subject to customary closing conditions. 

The group said Budweiser Apac would have a mutually beneficial relationship with AB InBev, operating under AB InBev’s world-class corporate governance standards and benefiting from access to a portfolio of global and multi-country brands.

“AB InBev will control a majority ownership of Budweiser Apac. If the over-allotment option is not exercised at all, AB InBev will control 88.86 percent as at the end of the exercise period. If the over-allotment option is exercised in full, AB InBev will control 87.22 percent as at the end of the exercise period,” the group said.

Budweiser Apac’s IPO will give the Hong Kong stock market a much-needed boost after China’s Alibaba Group Holdings delayed its listing worth about $15bn last month.

AB InBev shares closed 0.54 percent lower at R1 418.31 on the JSE on Wednesday.

BUSINESS REPORT