APB eyes bigger share of China premium segment

SINGAPORE-listed Asia Pacific Breweries LTD (APB) opened its thired greenfield brewery in China, saying it would intensify the group's participation in the premium segment. Operated by Heineken-APB(China) Pte LTD (HAPBC), the new plant in Guangzhou was built at a cost of some $62 mn. Earlier in May, HAPBC completed the sale of its shares in Kingway Brewery, also in Guangzhou, to GDH LTD for RMB1.08 bn (approximately $205 mn).

The Chinese beer market grew 6.3% to 448 mn hL in 2010. Capitalizing on th risng affluence and growth opportunites in China, APB has been actively pursuing the growing premium segment of the China beer market with international beer brands, Tiger and Hineken.

APB chief executive officer Roland Pirmez said at the time of the divestment that the Group remains committed to the Chinese beer market. "Our motivation is to keep ensuring that our prized beer brands, Tiger and Heineken, stay as attractive premum offerings to keep improving our organic growth and profitability," he said.

HAPBC owns a brewery in Shanghai and Hainan. In FY2010, APB's operations in China broke-even, turning around from a loss of S$5.9 million as reported in FY2009.