Vietnamese government to sell brewing shares

The Vietnamese government is set to sell all of its shares in the country’s two biggest breweries it has been announced.

As reported by Bloomberg, the Communist government is expected to sell its 89.59% stake in the Saigon Beer Alcohol Beverage Corp (Sabeco) brewery for around US$1.8 billion and its 82% share in the Hanoi Beer Alcohol Beverage Corp (Habeco) for $404m.

The shares in Sabeco will be divested in two tranches, one this year and one in 2017, while those of Habeco will all be offered this year.

As reported last year, over 50% of the stake in Sabeco will be auctioned later this year.

The shedding of these state-controlled assets is just part of a wider divesting of stakes held by the Vietnamese government in various industries.

The country desperately needs billions of dollars for infrastructure development and state revenue has dropped dramatically of late thanks to plunging oil prices and a struggling agricultural sector.

Beer is a booming industry in Vietnam, with the country projected to consume just over 4bn litres this year – up from the 3.8bn litres drunk in 2015 – and with the number of citizens of legal age expected to grow to over 70m by 2021 so beer consumption will likewise rise.

Foreign companies are investing heavily in Vietnam and Thai Beverage and Heineken in particular are expected to be major bidders for the Sabeco shares.

Sabeco, which brews the country’s most popular beers, ‘Saigon’ and ‘333’, has a 40% share of the Vietnamese market.