By Emilyn Yap

SINGAPORE - Did Heineken make an offer for the OCBC Group's stakes in Fraser and Neave (F&N) and Asia Pacific Breweries (APB) before those shares were sold to Thai parties?

The takeover drama surrounding APB today could have turned out quite differently, depending on the answer to the question.

What took place in the days before the sale is now adding another layer of intrigue to an already complicated affair.

OCBC, Great Eastern Holdings (GEH) and Lee Rubber agreed on July 18 to sell 22 per cent of F&N for $8.88 a share to Thai Beverage, and 8.6 per cent of APB for $45 a share to Kindest Place Groups. This happened after news broke on July 16 that OCBC and GEH were approached with an offer to buy their F&N and APB stakes.

F&N and Heineken are the two largest shareholders in APB.

The entry of the Thais prompted Heineken subsequently to make a bid for APB to defend its interests, offering to buy F&N's entire stake in APB at $50 a share.

Heineken's offer led to questions over whether OCBC could have gotten a better price for its F&N and APB stakes by offering them to the Dutch brewer.

On Tuesday, with the completion of the stake sale to the Thais, the bank's chief financial officer, Darren Tan, said: "ThaiBev's and Kindest Place's offers were the most attractive offers we had received and we found that the terms and conditions were in the interest of our shareholders.

"We considered price, the time required to transaction completion, ability to ensure deal completion and our internal valuation, amongst others."

According to a source, OCBC had told Heineken that it had received an offer for its F&N and APB stakes.

The bank later received from Heineken an offer for those stakes - which paled in comparison to the Thais' offer. It then signed the agreement to sell the shares to ThaiBev and Kindest.

But yesterday, a Heineken source said: "Heineken was not approached by OCBC for a price on its stakes in F&N and APB."

Heineken, however, did not respond directly when asked if it had given OCBC an offer for its stakes before they were sold to the Thais.

Its director for global external communication, John Clarke, said: "We were surprised by the OCBC decision to sell its shares to ThaiBev and Kindest Place.

"We have a highly attractive offer on the table that the F&N board has accepted, which will benefit all F&N shareholders. We continue to be in discussions with F&N."

For both Heineken shareholders and market watchers, knowing how the Dutch company responded to news of the initial offer for OCBC's stakes in F&N and APB before the deal was sealed is important - it could have avoided an expensive takeover battle for APB if it had forestalled the Thais earlier on.

Now, Heineken's bid for APB has been challenged by another one from Kindest, which is offering to buy just F&N's direct stake in APB for $55 a share. Analysts suggest this may force Heineken to raise its offer to $55 a share as well.

If Kindest's offer goes through, it will end up with a stake of just under 16 per cent in APB - becoming a considerable minority. Kindest's offer closes next Friday.

Heineken also faces potential opposition from ThaiBev. ThaiBev has become F&N's largest shareholder with a stake of 26.4 per cent, and some analysts expect it to oppose the sale of APB to retain a foothold in the Tiger beer brewer's thriving business.

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