Vietnam: Government to lower state share of Saigon Beer Alcohol Beverage Corp.

The Vietnamese Industry Ministry has proposed the government cabinet gradually reduce state ownership in the wholly-owned Saigon Beer Alcohol Beverage Corp. (Sabeco) to 51 percent, according to ThanhnienNews on December 7.

The move is in tune with the government’s orientation to auction shares in state-owned enterprises to sharpen competitive edge for international integration.

Under the proposal, state ownership of shares in the VND5.5 trillion (US$343.75 million) Sabeco are scheduled to lessen to 80 percent by next year, with employees first and then private interests allowed to buy up 20 percent.

The gradual reduction to the 51 percent mark would happen over several years, the ministry said, and fit with plans to diversify the company into financial investment, mining, hydropower development, banking and real estate.

Over the long-haul, Sabeco is oriented to go public on the local stock exchange in either Hanoi or Ho Chi Minh City, and invite a foreign financial consulting firm to evaluate its assets.

The ministry has urged the corporation to increase efforts to source out three strategic partners with the financial capability to take the company public.

Sabeco expected to find strategic investors in the industrial facilities, banking and distribution sectors to enhance its position.

The corp. targeted to double its beer output to one billion liters by 2010 to further capitalize on the fast growing local market.

Sabeco now produces 550 million liters of beer a year, mostly locally under its Saigon, 333, Green Saigon brands, with 40 percent of the volume from its brewery in HCMC, and the balance in partnership with other breweries nationwide.

The company reports annual sales of some VND6 trillion (US$373 million), mostly from its Saigon Beer brands, including after-tax profit of over VND1 trillion ($62 million).

Sabeco has exported Saigon beer to the US, Europe, Japan, Taiwan and Australia.

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