Anticipated Suntory IPO To Free Up Capital

Foreign acquisitions have been a pre-eminent theme across Japan's food and drink industry for a number of years, and privately owned beer and soft drinks giant Suntory is reportedly looking to list its food and drink business in order to raise capital with a view to pursuing deals .

C ompanies such as Asahi , Sapporo and Kirin have spent heavily on deals in order to reduce their exposure to the mature Japanese market, where growth opportunities have been negligible. The aforementioned trio have bought a number of companies across South East Asia with the aim of benefiting from emerging market growth. Suntory, which also seemingly needs to expand abroad, is no stranger to major foreign deals, having acquired France's Orangina Schweppes for nearly US$4bn in 2009 and PepsiCo's Vietnam soft drinks business earlier in 2012.

The opportunities for growth in markets such as Vietnam , where incomes are rising , are significant. S hould Suntory launch an initial public offering , it is in emerging markets such as Vietnam that we believe it will look to devote the freed-up resources to. As the chart illustrates, there is very little outright growth on offer in Japan in either beer or soft drinks over our forecast period.

Maturity And Competitiveness Make Growth Hard To Come By
Japan - Beer & Soft Drinks Sales (mn litres)

Anticipated Suntory IPO To Free Up Capital

Foreign acquisitions have been a pre-eminent theme across Japan's food and drink industry for a number of years, and privately owned beer and soft drinks giant Suntory is reportedly looking to list its food and drink business in order to raise capital with a view to pursuing deals .

C ompanies such as Asahi , Sapporo and Kirin have spent heavily on deals in order to reduce their exposure to the mature Japanese market, where growth opportunities have been negligible. The aforementioned trio have bought a number of companies across South East Asia with the aim of benefiting from emerging market growth. Suntory, which also seemingly needs to expand abroad, is no stranger to major foreign deals, having acquired France's Orangina Schweppes for nearly US$4bn in 2009 and PepsiCo's Vietnam soft drinks business earlier in 2012.

Maturity And Competitiveness Make Growth Hard To Come By
Japan - Beer & Soft Drinks Sales (mn litres)

The opportunities for growth in markets such as Vietnam , where incomes are rising , are significant. S hould Suntory launch an initial public offering , it is in emerging markets such as Vietnam that we believe it will look to devote the freed-up resources to. As the chart illustrates, there is very little outright growth on offer in Japan in either beer or soft drinks over our forecast period.

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