Singapore-based Fraser and Neave Ltd (F&N) has been accused of breaching joint-venture agreement with its Myanmar partner Union of Myanmar Economic Holding Ltd (UMEHL).
Military-owned conglomerate UMEHL said
F&N unilaterally sold its shares in jointly-owned Myanmar Brewery
Ltd to the TCC (Chang Beer) without even informing them.
It is against their agreement and UMEHL
will therefore acquire all the F&N’s shares in accordance with the
joint-venture contract, according to the UMEHL’s press release.
Myanmar Brewery Ltd is a leading company dominating Myanmar’s beer market. F&N has 55% and UMEHL 45% stake in the firm.
The company was first established by Singapore-based Asia Pacific Breweries (APB) and UMEHL at the ratio 55% to 45%. In 1996, APB sold all of its stakes to F&N because of the Western economic sanctions against Myanmar.
UMEHL said, according to the clause 16.4
(d) in the joint-venture agreement, F&N is needed to sell the
shares to them as the first priority, and any share transfer or sale
also requires the other partner’s formal consent.
F&N’s failure to meet the agreement
terms had been officially protested within 90 days in accordance with
the joint-venture contract, UMEHL said.
In following month, the audit firm CMA
started share valuation of Myanmar Brewery Ltd. However, F&N and
UMEHL could not reach an agreement over the share values that they
decided to go to arbitration.
Nevertheless, UMEHL said they would acquire the shares from F&N in accordance with the joint-venture agreement.
UMEHL also criticized TCC (Chang Beer)
for not appearing to solve the issue with F&N, and not noticing them
about the share buying.
source: Eleven Myanmar
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