Its share of Myanmar Brewery will be sold at $775m, as determined by independent valuer
Beverage giant Fraser and Neave (F&N) has resolved a legal dispute with joint venture partner Myanma Economic Holdings (MEHL) over their Myanmar Brewery.
F&N will now proceed to sell its 55 per cent stake in Myanmar Brewery to MEHL for US$560 million (S$775 million).
MEHL said in a statement yesterday that both parties have agreed to the completion of the sale, in line with a ruling by an arbitral tribunal at the end of last year.
The firm added this will “bring to a closure all disputes relating to the payment for the stake”.
Myanmar Brewery produces the best-selling Myanmar Beer, and is a key asset in F&N’s drinks unit. MEHL owns a 45 per cent stake in the brewery.
The tribunal also ordered both parties to take all steps necessary to complete the sale to MEHL or its nominee within 30 days of the stake’s valuation.
F&N had previously stated its position that any sale of the stake should be completed at the estimated fair value of US$560 million, adding the sum was determined by a jointly appointed independent valuer.
The fair value was determined on July 22, and the sale will be completed on or before Aug 20, upon the payment of US$560 million.
The tussle between the two firms began in 2013, when F&N was taken over by parties linked to Thai tycoon Charoen Sirivadhanabhakdi.
MEHL said F&N defaulted on part of the joint venture deal, giving it a “clear right” to buy F&N’s stake.
Last month, it asked the Singapore High Court to force the sale of the 55 per cent stake in the brewery held by F&N to be completed by Aug 20. MEHL had also filed an application for an interim injunction requiring F&N to sell its stake for 500 billion kyat (S$540 million).
F&N said yesterday that those will be withdrawn by MEHL.
Losing this battle means that F&N has lost its only remaining alcohol product. It sold its stake in Asia Pacific Breweries, the maker of Tiger Beer, to Heineken in 2012.
F&N added: “The company will be making a separate announcement with further details in due course.
“In the meantime, shareholders of the company are advised to exercise caution when dealing with the shares of the company.”