The recent successful acquisition of a major stake in Singapore-based Fraser and Neave Limited (F&N) represents a shortcut for Thai Beverage Plc (ThaiBev) to become a top player in Asia's huge beverage market, a status it would otherwise take years to achieve.
Showing the way: Thapana Sirivadhanabhakdi (right) gestures to his billionaire father Charoen, chairman of ThaiBev, during the ThaiBev Expo 2012, a two-day conference attended by nearly a thousand dealers, in Bangkok yesterday.
Thapana Sirivadhanabhakdi, president and CEO of ThaiBev, the flagship of a business empire controlled by his billionaire father Charoen, yesterday talked about the motivation behind the 80-billion-baht takeover of a 29% stake in F&N, the largest deal of its kind in decades.
At yesterday's interview, Mr Thapana outlined ThaiBev's growth strategies: pursuing more mergers and acquisitions, largely overseas, and strengthening its own businesses through iconic brands like Chang.
"We want to expand our businesses as fast as possible through our own brands and external business opportunities," said one of the five heirs of Mr Charoen, third on Forbes's 2012 Thailand 40 Richest ranking, with a net worth of US$6.2 billion.
ThaiBev's sales total 130 billion baht and the company targeted to achieve turnover of 200 billion baht in 2015.
The sale target would be brought forward as the company is on the lookout for more acquisitions.
The F&N deal will significantly expand ThaiBev's international sales to 32 billion baht next year from 6.5 billion baht this year.
The proportion of international business in total sales will also surge to 30% in 2013 from a mere 5% at present.
"F&N is a blue-chip company. It has not only various beverage products but also operations around Asia-Pacific, as well as management expertise," he said.
When the Asean Economic Communty (AEC) is formed in 2015, ThaiBev will have to compete with many international firms, he said.
"For example, a Japanese company's overseas sales make up 30% [of its total sales] compared to ThaiBev's 5% through Chang, Mae Khong and Oishi. "Even if we increase our overseas sales by 30% every year, we could not compete with it."
Mr Thapana said ThaiBev's business model has been adjusted to prepare itself for more intense regional competition. Over the past three decades, the company has shifted its focus from low-priced and value-for-money offerings through three strategies.
The company has sought new export markets, improved manufacturing facilities for ease of quality control and strengthened its distribution network.