Soft-drink bottler Sermsuk Plc has agreed to sell its "est" brand and trademark for B1.56bn to International Beverage Holdings Ltd, which is wholly owned by Thai Beverage Plc.
Thai Beverage Plc, the producer of Chang beer, has acquired "est" brand from Sermsuk Plc.
Under the conditional sale, Sermsuk will get a guaranteed contract to pack and distribute est products in the Thai market.
Currently, the est brand is owned by Sersuk’s wholly owned Hong Kong-based subsidiary Great Brands Limited. Sermsuk obtained the licence to use the trademark for the production, packaging, sale marketing, advertising and distribution of finished products of cola and other soft drinks.
Thai Beverage is the major shareholder in Sermsuk, holding a 64.66% stake through its other wholly owned subsidiary Thai Beverage Logistics Co. Thai Beverage is the producer of Chang beer and is owned by liquor tycoon Charoen Sirivadhanabhakdi.
The est brand was launched in November 2012. As of August 2014, Sermsuk claimed the brand had captured a 12% share of the total carbonated soft drink market in Thailand.
Somchai Bulsook, Sermsuk’s chairman of the executive board, said in the company’s notification to the Stock Exchange of Thailand that Sermsuk recognised that brand building required a large investment and long duration.
The sale will give the company capital to invest in building best-in-class sales and distribution capacities without the need to spend capital on brand building, he said.
Mr Somchai said the buyer had also committed to building the brand while the company would continue to benefit from contract manufacturing and distribution fees as the volume grew.