KT&G Looking at Bidding for KKR's Oriental Brewery -Sources

By Prudence Ho and Cynthia Koons

HONG KONG--KT&G Corp. (033780.SE) may bid up to US$3 billion for Kohlberg Kravis Roberts & Co.'s Oriental Brewery Co., people with knowledge of the matter said.

There is no guarantee the Korean tobacco giant will formally bid. The matter is still in its early stages, the people said. But if KT&G decides on a deal the company is likely to partner with another fund or funds to buy the brewer, one of the people said.

KT&G denied that the company is considering a bid for Oriental Brewery while a spokesperson at KKR declined to comment. Korea's No. 1 beer maker said it has no knowledge of the matter.

U.S. private equity firm KKR bought Oriental Brewery in 2009 from Anheuser-Busch InBev NV for US$1.8 billion. It is still Asia's top completed leveraged buyout since the financial crisis, according to Dealogic.

While KKR hasn't launched a formal sale the beer company is an attractive target because it has increased its domestic market share under KKR's ownership.

-Kanga Kong in Korea contributed to the story.

Write to Prudence Ho at prudence.ho@wsj.com and Cynthia Koons at cynthia.koons@wsj.com

Corrections & Amplifications

This article was corrected at 09:47 GMT to fix the company's stock symbol in the first paragraph. It should be 033780.SE, not 033780.KS.

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