May 28, 2013

ThaiBev takes aim at Myanmar

Thai Beverage Plc (ThaiBev) is seeking a greater presence in Myanmar through its partnership with Fraser and Neave Ltd (F&N), the Singaporean firm acquired earlier this year by the Thai drinks giant.

Thapana Sirivadhanabhakdi, ThaiBev's president and chief executive, said the company is also considering importing Myanmar beer into Thailand, where many migrant workers from Myanmar live.

F&N which was taken over by ThaiBev, led by the Thai billionaire Charoen Sirivadhanabhakdi in a deal worth S$13.8 billion (327 billion baht) owns a stake in Myanmar Brewery Ltd.

"Myanmar is the rising star of Asean, the one everyone is looking at, and the market there is similar to Thailand's," Mr Thapana said on the sidelines of last week's Asean Economic Community (AEC) seminar in Bangkok hosted by KPMG Thailand.

"With growing income per capita, there's a huge opportunity for consumer goods and companies such as ThaiBev. We are already a player there and can build on the partnership with F&N."

He said investment in Myanmar production will have to wait for improved infrastructure such as electricity and water supply.

In the meantime, ThaiBev could bring Myanmar beers to the Thai market.

"We're looking at opportunities in the Myanmar market as well as the chance of Myanmar products coming here," said Mr Thapana.

The Myanmar government reportedly is prepared to relax limits on foreign ownership of breweries on a case-by-case basis in a bid to project a friendlier image to foreign investors.

The Myanmar Investment Commission, which oversees foreign investment, in January offered four licences for international breweries to operate domestically.

ThaiBev is one of two brewers _ Denmark's Carlsberg being the other _ that won approval in February to set up breweries in Myanmar.

ThaiBev is allowed to produce its flagship Chang brand in Yangon, Mandalay and Shan state.

Apart from Singapore, F&N has a presence in Malaysia and Vietnam.

Mr Thapana said F&N products made in Malaysia may suit the Indonesian market better than Thailand due to the many Muslims living there who require halal products.

"ThaiBev is now on a learning curve of expanding business in the region," he said.

"Asean is a hotspot, with growing gross domestic product. ThaiBev wants to be the leader in Thailand and the region."

With the single market set to remove barriers, both opportunities and risks will arise.

"If you prepare yourself and are ready for greater competition, the AEC will give you the opportunity. If you are not going out, the competitors will come in anyway," said Mr Thapana. "Small companies can also survive if they identify and develop their uniqueness."

Source: Bangkok Post