AB InBev to Raise $5 Billion in Asian Unit’s Hong Kong IPO

(Bloomberg) — Anheuser-Busch InBev NV is set to raise about $5 billion after pricing the initial public offering (IPO) of its Asian unit at the bottom of a marketed range and exercising an option to sell more shares.

A total of 1.45 billion Budweiser Brewing Company APAC Ltd. shares were priced at HK$27 ($3.44) each, the company said in a statement on Tuesday. That compared with the marketed range of HK$27 to HK$30. The company has partially exercised an upsize option, issuing an additional 189 million shares on top of the initial base offering of 1.26 billion shares.

The firm also has an over-allotment option to sell as much as 217.8 million additional shares. If that option is fully exercised, the total funds raised for AB InBev will increase to $5.9 billion and the Belgian brewer will control about 87% of Budweiser Brewing, it said.

Even priced at the bottom of its range, the return of Budweiser Brewing’s offering after an aborted first attempt in July would be a major boost to the Hong Kong bourse at a time when the city’s ongoing anti-government protests and trade tensions between U.S. and China are rocking the market. It will also propel Hong Kong past Shanghai as the world’s No. 3 in terms of first-time share-sale volume.

Excluding Budweiser Brewing, companies have raised a total of $11.1 billion through IPOs in Hong Kong this year, according to data compiled by Bloomberg. At $5 billion, the brewer’s listing would be the second-largest globally this year, trailing Uber Technologies Inc.’s $8.1 billion U.S. sale in May.

In July, AB InBev agreed to sell its Australian business to Asahi Group Holdings Ltd. for $11.3 billion, just a week after the brewer shelved a share sale in which it sought to raise as much as $9.8 billion.

The removal of AB InBev’s Australian unit, in hiving off a slower-growing part of its Asia-Pacific empire, has made the latest IPO plan more attractive to investors who balked at the previous deal’s valuation. Without Australia, the Asian unit’s revenue in 2018 was $6.7 billion, representing organic growth of 7.4%, said the company in its latest preliminary prospectus. In the earlier filing, the Asian unit including Australia had revenue of $8.5 billion, representing organic growth of 6.1%.

The offering has attracted GIC Pte. as a cornerstone investor with a commitment of about $1 billion. The company didn’t line up any cornerstone investor for its previous share sale.

Budweiser Brewing is expected to start trading on Sept. 30. JPMorgan Chase & Co. and Morgan Stanley are joint sponsors for the Hong Kong share sale.

Contact editor Yang Ge (geyang@caixin.com)