Japanese beverage giant Kirin Holdings Co said yesterday that it has decided to withdraw from its joint venture in Myanmar.
Kirin, owner of the San Miguel, Fat Tire and Lion brands, said that its board made the decision to “urgently terminate” the partnership with Myanma Economic Holdings Ltd (MEHL), a military-affiliated company, after finding that it would be difficult to quickly end the venture in the way Kirin wanted to.
The company said more than a year ago that it was unhappy with a military takeover on Feb. 1 last year, which violated its corporate standards and human rights policy.
The military ousted the elected government of Aung San Suu Kyi, triggering mass nonviolent protests nationwide. When the military and police responded with deadly force, armed resistance arose in cities and the countryside in a fierce struggle for power.
However, Kirin had been trying to keep its beer business in the country and get MEHL to sell its stake, saying it wanted to support its employees and help the country. Now, Kirin intends to sell its 51 percent stake, but not to MEHL, the brewery said.
Earlier, the company sought commercial arbitration in a dispute with MEHL over its plan to unwind the joint venture. MEHL had petitioned for liquidation of the venture, which Kirin said violated the joint venture agreement and was an “unjustified motion.”
A court recently ruled against MEHL’s petition, citing a technicality.
Myanmar Brewery, founded in 1995, produces beers under the Myanmar, Kirin Ichiban, Andaman Gold and Black Shield brand names.
It was unclear if the brewery would continue to make Kirin Ichiban after the venture ends.
Kirin said that it was recording an impairment loss last year on its business in Myanmar of ￥68 billion (US$589.73 million).
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