GLOBAL: China Resources To Raise New Funds To Buy Out SABMiller From JV

China Resources Beer has announced plans to raise HK$9.5bn through a new share offer, which it will use to partially fund its acquisition of SABMiller’s stake in their CR Snow joint venture.

China Resources said it will issue around 811 million new shares at HK$11.73 each, a significant discount (around 30%) compared to Tuesday’s closing price.  CRH Beer, its controlling shareholder with a 51.67% stake, will take up its entitlement.

In March, the two sides agreed to a deal that would see China Resources acquire SABMiller’s 49% stake in CR Snow for US$1.6bn.  The Chinese brewer will also use proceeds from the rights issue to fund expansion, saying it is open to suitable acquisition opportunities.