‘Bud’ Maker Anheuser-Busch Will Acquire 5% of Tsingtao, Brewer of Top Chinese Beer

Anheuser-Busch is snapping up a piece of China’s Tsingtao brewery as the latest acquisition in a foreign buying spree, the American brewer said Monday.

Busch’s move was disclosed as Tsingtao announced it will be listed on the stock exchange here and will offer 317.7 million new shares to raise the equivalent of $114 million.

After the listing, Anheuser-Busch Cos. Inc. will take a 5% stake in Tsingtao, buying 45 million shares for about $16.4 million.

Busch said that “at this time” the investment will not affect distribution in China of Budweiser beer, which is sold there through import arrangements.

Tsingtao beer is one of the most popular beers in China. It is the most exported Chinese brand and the top-selling Chinese beer in the United States.

Anheuser-Busch’s Chinese investment comes after its purchase of a 17.7% interest in Grupo-Mondelo of Mexico City, producers of Corona beer. Busch also has arranged for joint ventures to market Budweiser with Japan’s Kirin and Italy’s Peroni brewers.

It said market analysts have noted a 14% expansion of the Chinese beer market over the last five years.

Company President August A. Busch III said the Tsingtao investment has strategic importance for Busch’s international development because of the “enormous potential of the Chinese beer market.” Tsingtao is the first state-run company in mainland China to be listed on the Hong Kong exchange.

Tsingtao makes German-style lager beer in the city for which it is named (now spelled Qingdao). The brewery was established by Germans who ruled the city at a time when Chinese governments were forced to allow foreigners to run a number of ports.

The Qingdao government will keep a 44% stake in the brewery; the Bank of China and other Chinese government agencies will own about 10%. International and Hong Kong investors will buy 30%.