Suntory may unwind losing JV
Print Edition
JAPANESE beverage conglomerate Suntory Holdings could unwind its loss-making joint venture with China’s Tsingtao Brewery Co as sales have stalled amid stiff competition in the Chinese market, people familiar with the matter said yesterday.
Scrapping the joint venture would highlight the difficulties Japanese brewers face in expanding in the global beer market, which is set to be dominated by a planned merger of its two biggest players, Anheuser-Busch InBev and SABMiller.
A Suntory spokeswoman confirmed the company was discussing “various possibilities” with Tsingtao but could not comment further. A China-based spokeswoman for Tsingtao said she was unaware of news of the sale and declined to comment further.
The Nikkei financial daily had said earlier that Suntory plans to sell its stake in sales and production to Tsingtao for between 10 billion yen and 20 billion yen (US$84 million and US$168 million) in the first half of 2016.
The sources, who declined to be named, said Suntory was reconsidering the joint venture because of weak sales.
Set up in 2012, the joint venture has failed to flourish amid stiff competition from Chinese rivals including industry leader China Resources Snow Breweries.
One source said that even if the joint venture was dissolved, Suntory was keen to continue selling its own-brand beers in select areas around Shanghai through Tsingtao.
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