Just 10 years ago, a new group burst onto the scene in Thailand, effectively gathering several market-leading alcoholic beverage companies into one truly powerful holding: Thai Beverage Public Company Limited. Soon afterwards, the group expanded to the non-alcohol and food businesses, thus diversifying its product portfolio and strengthening its hold on the sector.
Today,
ThaiBev is the absolute leading beverage producer in Thailand and ranks among the largest in Asia as well.
However, ThaiBev’s reach extends well beyond Asia, and one could argue that its most popular product, Chang Beer, actually serves as a Thai ambassador to the world. A green curry, a Pad Thai or a tom yum soup simply aren’t complete without an elephant-adorned bottle of what has been voted Asia’s best lager.
“Chang shows two white elephants of the Siam country, which is one of Thailand’s most representative symbols,” explains Thapana Sirivadhanabhakdi, ThaiBev’s President and CEO.
“The two elephants face each other and come towards the fountain that represents prosperity. The brand distinguishes itself from the rest, as Chang translates into ‘elephant’, which is also a great tool to communicate a Thai word to the international community. It is true that Chang promotes the ‘Thainess’ as people easily relate the brand to Thailand.”
Chang is also showing up in the football world, having become the first Thai brand to be placed on an English Premier League shirt (Everton) and more recently, sponsoring Spanish rivals Real Madrid and FC Barcelona.
We have the ambition to become the regional powerhouse in the beverage business.
Thapana Sirivadhanabhakdi, President and CEO, Thai Beverage PLC |
The group produces single malt whisky (including the award-winning Old Pulteney brand), rum, soya drinks, flavoured soda water, sweet fizzy drinks, electrolyte beverages and green teas, among others – in short, a product portfolio that fits the varying tastes and preferences of the different Asian markets.
Moreover, organic expansion combined with a few recent mergers and acquisitions is indeed allowing ThaiBev to better penetrate these varied neighbouring markets.
In 2011, the group bought PepsiCo’s 41.5 per cent stake in Thai company Sermsuk. Then, earlier this year, in a move that turned not a few heads in the business world, Charoen Sirivadhanabhakdi (ThaiBev owner) via ThaiBev and TCC Assets Ltd (TCCA) – also owned by the Sirivadhanabhakdi family – boldly bought out the Singapore-based drinks and property conglomerate Fraser and Neave Ltd (F&N). The total deal by ThaiBev and TCCA increases the value of F&N to a staggering $11.2 billion (£7.2 billion).
Those familiar with the Sirivadhanabhakdi modus operandi, however, know that this extravagant move falls in line with ThaiBev’s focus on a long-term outlook.
“For us, it is not only about maximising the value, but also about creating value through long-term partnerships, which is much more meaningful,” says President and CEO Thapana, Charoen’s third-oldest son and winner of Asia’s Best CEO for Investor Relations at the 2012 Asian Excellence Recognition Awards.
Investment firm CIMB has also pointed out that ThaiBev’s forward-thinking strategy in the face of the group’s now increased debt level is a firm step towards expansion: “ThaiBev is laying the groundwork for dominance of the beverage sector in Singapore, Malaysia and Thailand. This makes the business more valuable in spite of balance sheet strain.”
Despite this growth, Mr Sirivadhanabhakdi maintains that ThaiBev is a local leader. He says that the group looks forward to more participation in the region and that the greater the collaboration, “the greater the synergies on a wider scale, which will not only benefit the companies, but also the general public and consumers.”
This, of course, does not only apply to ThaiBev but to all companies in the region that aspire to grow beyond their own country’s borders. And Thailand, asserts the President and CEO, is set to play an important role for the development of neighbouring countries, such as Myanmar, Cambodia, Vietnam, Laos, Malaysia and Singapore.
“Thailand has the unique advantage of our geographic location, which provides accessibility to many ASEAN countries,” he says, adding that to seize the opportunities within the ASEAN region, “collaboration and connectivity will be important, because we see that each of our own economies will not enjoy the vast potential the AEC offers unless we work as one.”
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