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IPO is brewing for AB Inbev’s Asia Pacific arm: Reuters
Posted on Monday, 15 April 2019 13:57
Citigroup and Bank of America Merrill Lynch have joined Morgan Stanley and JPMorgan on the upcoming USD 5.00 billion initial public offering of Anheuser-Busch (AB) InBev’s Asia Pacific arm, sources close to the process told Reuters. According to these people, the team are working towards submitting paperwork either this month or early May in order to launch a first-time share sale in Hong Kong in the second half of this calendar year. These sources, who have direct knowledge of the matter but declined to be named as they are not authorised to speak to the media, added proceeds from the float will be used to pay down debt. While Reuters could not determine just how much of the Asia Pacific operations AB Inbev intends to spin off, one thing is for certain: the proposed listing could be one of the region’s largest of the year. Zephyr, the M&A database published by Bureau van Dijk, shows only three IPOs on Asian exchanges exceeded USD 5.00 billion in 2018. By far and away the biggest of the year was Japanese mobile telecommunications provider Softbank Corp raising USD 21.39 billion in Tokyo in December. China Tower’s USD 7.49 billion debut in Hong Kong in August was the second-largest of the 12 months while Xiaomi’s USD 5.43 billion listing on the bourse in July was third. Regardless of the size of the IPO by AB Inbev’s Asia Pacific business, the reported USD 5.00 billion fundraiser is a mere drop in the ocean when compared to the beverage giant’s net debt of USD 102.50 billion at the end of December 2018. The group intends to reduce its capital structure to around 2x net debt to normalised earnings before interest, tax, depreciation and amortisation (EBITDA) in the 12 months to 31st December 2019 from 4.6x in FY 2018. Revenue for its Asia Pacific operations was up 6.1 per cent year-on-year at USD 8.47 billion while normalised EBITDA rose 12.8 per cent to USD 3.08 billion. © Zephus Ltd