Lucio Tan mulls IPO for Asia Brewery

By Zinnia B. Dela Peña, The Philippine Star

Posted at Feb 13 2012 06:44 AM | Updated as of Feb 13 2012 07:27 PM

MANILA, Philippines - With Asia Brewery Inc. growing rapidly and profitable, tobacco, beer and airlines tycoon Lucio Tan is mulling over a potential initial public offering (IPO) for the country’s second largest brewery.

After struggling to turn a profit, Asia Brewery has been in the green for two years now and has grown bigger and stronger with a diverse set of product offerings that have become an instant success.

In order to get listed on the first board of the stock exchange, an applicant company must have a track record of profitable operations for three years, a market capitalization of P500 million provided it has a five-year operating history, and/or net tangible assets of P500 million.

Tan, listed by Forbes Magazine as the second richest Filipino in the Philippines with assets worth $2.8 billion, set up Asia Brewery in 1982, producing its first beer, Carlsberg, in 1987 through a tie-up with Carlsberg International of Copenhagen, Denmark. This was followed by its flagship brand Beer na Beer.

Asia Brewery’s other beer brands include Lone Star, Colt 45, Stag, Colt Ice, Coors, Lone Star Ice, and Lone Star Ultra (the country’s first low-carb beer).

Asia Brewery has branched out into nonalcoholic beverages and bottled water, with Absolute distilled drinking water, Summit Natural Drinking Water, Absolute Pure Distilled Drinking Water, Pacific Sun Iced Tea, among other brands.

The company entered the low-priced carbonated softdrinks market with the acquisition of a license to produce Virgin Cola from Virgin Drinks. It also produces Summit Vitaminwater, ZeroCal and 100Plus.

In 2008, Asia Brewery teamed up with Cobra International Beverage Holdings Inc. to introduce the Philippine version of Cobra Energy Drink, which is currently the leading energy drink in the country.

Also contributing to Asia Brewery’s strong sales is Tanduay Ice of unit Tanduay Distillers Inc. which owns two of the largest distillery firms in the country – Asian Alcohol in the Visayas and Absolut Distillers in Luzon.

Among the Tan-owned companies listed on the exchange are Tanduay Holdings Inc., PAL Holdings, MacroAsia Corp., Eton Philippine Properties, Philippine National Bank, and Allied Bank.

Getting listed on the bourse will give the firm access to capital to fund growth, will create liquidity, maximize value, and increase its visibility.