Kirin Investing in Brazil
A highly competitive and shrinking home market has forced Kirin and rival Asahi Group Holdings to look abroad for profit growth, but a lack of targets in consolidating global beer markets has made expansion tough for Japanese brewers.
The maker of Ichiban Shibori beer says it has bought all outstanding shares of Aleadri-Schinni Participacoes e Representacoes S.A., which holds a 50.45% stake in Schincariol, Brazil's No.2 beer and No.3 soft drinks maker.
Kirin has increasingly focused on building market share in Asia and Oceania by taking stakes in Singapore's Fraser & Neave and San Miguel Brewery of the Philippines, as well as buying Australia's No.2 brewer Lion Nathan in 2009.
"Since the Australian deal, Kirin has been eyeing further expansion and in the current state of strengthening yen, I think this is an inevitable sequence of events," said Hiroshi Saji, a senior analyst at Mizuho Securities.
However with only a few targets available -- such as Australia's Foster's Group, for which world No.2 SABMiller has launched a $10.4 billion offer -- as world brewers are scrambling to grow overseas, Kirin made the buy outside its focus region.
"In the beer market there is not such a large number of opportunities available, globally it wouldn't be a long list, so when this very good investment opportunity came up in Brazil, a large market with high growth potential, we decided to invest," Kirin president Senji Miyake told reporters.
Brazil is the world's third-largest beer market after China and the U.S., with beer consumption rising in recent years buoyed by an economic boom and rising wages. The market is dominated by the world's largest brewer Anheuser-Busch InBev with a market share of near 70%.
From the August 2, 2011,Prepared Foods' Daily News.
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