Ginebra Readies Itself For Foreign Competition

Philippine spirits producer Ginebra San Miguel has acquired all outstanding shares in its rival East Pacific Star Bottlers Philippines for PHP200mn (US$4.6mn). While Ginebra's acquisition could have been prompted by the reasonably attractive opportunities in the local spirits industry and the prospect of stronger pricing power, we believe a bigger motivation is the growing influx of foreign spirits brands, which would inevitably threaten its market share. By acquiring East Pacific Star, Ginebra is looking to consolidate its market position in the local spirits sector to better contend against intensifying competitive pressures from foreign producers.

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