China Resources Enterprise Ltd has bought 21.37 percent of Kingway Brewery Holdings Ltd for about $161.3 million, a company official confirmed on Thursday.

"It is a good investment and comes after prolonged consideration," Vincent Tse, general manager of strategic planning at China Resources Enterprise, told Reuters. He gave no further details.

China Resources Enterprise bought 365.77 million shares in Kingway at an average price of $0.441 each on March 9, Tse said, confirming data obtained from a disclosure from the Hong Kong bourse late on Thursday.

China Resources Enterprise, which produces China's top beer brand, Snow, with SABMiller Plc, is looking to buy brewery assets in China.

Kingway Brewery said on Wednesday that substantial shareholder Heineken-APB (China) Pte Ltd was planning to divest its stake in the Chinese brewer.

Singapore's Asia Pacific Breweries (APB) had said its joint venture in China, Heineken-APB (China), had reached an agreement to sell a 21.37 percent stake in Kingway for 1.08 billion yuan ($164.4 million).

Kingway is jointly controlled by APB, a unit of Singapore food and property conglomerate Fraser and Neave Ltd, and the world's third-largest brewer Heineken NV.

China Resources Enterprise has been aggressively growing its businesses through either organic growth or acquisitions.

The government-backed conglomerate said it would open coffee shops at some of its 200 hypermarkets, after acquiring an 80 percent stake in Pacific Coffee, Hong Kong's second-biggest coffee chain, for HK$326.6 million last June.

The company also said in August last year that it might spend as much as HK$5.5 billion on more acquisitions by the end of the year.

"We have negotiations at the moment in all four sectors" of retail, beer, non-alcoholic beverages and food, Chief Financial Officer Frank Lai said in Hong Kong in August.

China Daily - Reuters

(HK Edition 03/11/2011 page2)