Asahi to sell its stake in Tsingtao?

Asahi is considering selling its stake in China's Tsingtao Brewery to focus its energy on overseas acquisitions. 

“Ownership without control doesn’t make much sense," said Asahi President Akiyoshi Koji, referring to the company only having a 20% stake in Tsingtao.

The company wants to grow its overseas business to around 30% of sales to offset a falling domestic beer market.

The Japanese beer market has been shrinking for the past 12 years running. Shipments fell 2.4% in 2016 alone.
Asahi bought AB InBev's eastern European beer brands last month for more than $10billion, the largest-ever overseas beer deal by a Japanese brewer.

The deal included Pilsner Urquell from the Czech Republic, Poland's Tyskie and Lech, Hungary's Dreher and Romania's Ursus.

The brands expanded Asahi's European footprint following its acquisition of SABMiller's western European brands Peroni and Grolsch.

The deal gave Asahi a 9% of the European beer market excluding Russia. Eastern Europe is a particularly thirsty market: the Czech Republic has the world's highest per capita consumption.

However, analysts expressed concerns Asahi had paid too much for the AB InBev brands and the company's share price fell following the news. 
“Asahi is heading in the right direction by expanding overseas, but the price seems too expensive,” Masayuki Kubota, chief strategist at Rakuten Securities, told the Wall Street Journal. “Investors will be watching whether Asahi can offer a reasonable explanation about the high price.”

The deal pushed Asahi's net debt to over five times its earnings before interest, tax, depreciation and amortisation (EBITDA), but Koji won't let that stand in the way of new deals.

"I'm not saying we won't make any acquisitions until our net debt/EBITDA goes back to three, though I'm not saying we will make any acquisitions either," he said.
The Tokyo-based brewer is one of several companies that have registered to buy a stake in Vietnam’s biggest beer maker, Saigon Beer Alcohol Beverage Corp.

"We are always studying potential targets," said Koji. "We need to keep studying, so that we can stay sharp for good deals."