Analysts say Tsingtao deal good for Anheuser.
Anheuser-Busch has made a canny can·ny
adj. can·ni·er, can·ni·est
1. Careful and shrewd, especially where one's own interests are concerned.
2. Cautious in spending money; frugal.
a. deal with Tsingtao, according to according to
1. As stated or indicated by; on the authority of: according to historians.
2. In keeping with: according to instructions.
3. industry analysts. A-B A-B Air-Britain (UK-based aviation historical society)
A-B Research Centre Applied Biocatalysis (Graz, Austria) will raise its share of Tsingtao to 27% from the current 4.5 percent, in a debt equity deal that will allow A-B to begin converting bonds into shares in late 2003. Asian analysts said that Anheuser-Busch is not paying a high premium for its shares.
China's beer market, while still very regional in nature, has been growing at 6% a year. Tsingtao has been one of the fastest-growing Chinese breweries See for an up to date listing of all the breweries detailed on Wikipedia, sorted into regions.
Tsingtao needs the funds from A-B to modernize mod·ern·ize
v. mo·dern·ized, mo·dern·iz·ing, mo·dern·iz·es
To make modern in appearance, style, or character; update.
To accept or adopt modern ways, ideas, or style. existing breweries and continue acquisitions. Analysts think Tsingtao may have bought too many breweries too fast, but Anheuser-Busch dollars and expertise will help Tsingtao consolidate its expansion.
Over the long term, analysts said the deal will provide enormous dividends for Anheuser. The St. Louis brewer will immediately gain higher exposure within the Chinese market, and will be able to make use of Tsingtao's extensive sales and distribution network.