LUCIO C. TAN’s Asia Brewery, Inc. is reforming its joint venture with Dutch brewery Heineken International B.V. for a new partnership structure that will continue bringing its products to the country.
LT Group, Inc., the listed parent of Asia Brewery, told the stock exchange on Wednesday that the beer manufacturers were working to create a “realigned” partnership to be completed by the end of the year.
“[Asia Brewery and Heineken] have agreed to transition the AB Heineken Philippines, Inc. joint venture to a new partnership structure to produce and distribute Heineken beer brands Heineken and Tiger in the Philippines,” it said.
“Heineken will establish a sales and marketing office based in Manila and will engage Asia Brewery to brew and distribute its beers in the country,” it added.
Asia Brewery and Heineken started their partnership in May 2016 through joint venture AB Heineken Philippines. It is jointly controlled by both companies, with each owning 50%, and manufactures beer brands such as Asia Brewery’s Beer na Beer, Colt 45 and Brew Kettle, and Heineken’s Heineken and Tiger.
In Wednesday’s statement, Asia Brewery said Heineken continues to see a “good long-term business opportunity” in the Philippines and wants to continue distributing its Heineken and Tiger brands to the country.
“The immediate priority for Asia Brewery and Heineken is to ensure a smooth transition for the employees of AB Heineken Philippines and continuity for its customers and suppliers,” it said.
LT Group was not immediately available for comment when asked about the reason for the partnership realignment.
Aside from its joint venture with Heineken, Asia Brewery also produces energy drinks, bottled water, soy milk, and yoghurt products. It is 99.9% owned by LT Group to represent the holding firm’s beverage segment.
In the first six months of 2020, net income from LT Group’s beverage segment fell 85% to P40 million. But the whole group’s attributable net income climbed 9% to P10.03 billion due to growth in the tobacco, distilled spirits, and property segments.
Shares in LT Group at the stock exchange picked up 74 centavos or 8.08% to P9.90 each on Wednesday. — Denise A. Valdez