Super Group

Super Group: Bloomberg notes Super may be the best takeover option for beverage companies anxious to corner a piece of Asia’s expanding instant-coffee market, as long as they’re willing to pay up. According to stock brokers, the maker of Super Coffee sachets offers suitors established brands and a distribution network across SE Asia. Japan’s Kirin and Suntory Beverage & Food are among logical buyers that may need to offer at least US$2.2b (or more than S$5 a share) to convince Super’s founders to sell, according to Maybank-KE. Such a bid would be the most expensive relative to net income for any coffeemaker in Asia, and comes at a 36% premium to Super’s last closing share price of $3.69. Still, analysts believe the founders of Super are unlikely to sell for a price as low as S$5 a share because the stock was near that level as recently as August. Super’s shares have surged more than fivefold in the last four years. Regional demand for food and drinks has climbed with rising wealth, and data shows no peer in developed Asia has increased profit faster than Super in the past five years. SE Asia’s instant-coffee market is projected to expand 38% from last year to almost $4b in 2017, according to Euromonitor. Meanwhile, Super is tipped to be one of the biggest beneficiaries of the increasing consumption, as it offers any potential buyer solid brands, an integrated ingredients and manufacturing chain, and an extensive marketing reach in SE Asia. Super, which sells Owl-branded coffee and instant cereal, owns factories from China to Malaysia. Branded products account for ~65% of the 27-year-old company’s revenue, while food ingredients make up the rest.