Carlsberg Exits Tibetan Brewery Venture, Ceding Full Control to Local Partner

COPENHAGEN/LHASA – Carlsberg A/S has finalized its exit from the Tibetan beer market, agreeing to sell its entire stake in the Lhasa Brewery joint venture to its long-time local partner, Tibet Development Co., Ltd. The deal, valued at 292 million yuan (approximately $42 million), grants the Chinese firm full ownership of the brewery and concludes a partnership that has faced operational challenges in recent years.

In a brief statement to Just Drinks, the Danish brewer confirmed the divestment of its 50% holding. The transaction was disclosed by Tibet Development in a filing to the Shenzhen Stock Exchange on January 30. Upon completion, Tibet Development will hold 100% of Tibet Lhasa Brewery Co., Ltd., a prominent regional brand.

The Chinese company stated the acquisition would "strengthen the integrity of the listed company's assets" and enhance its "management control and operational efficiency" over the Lhasa Beer brand. It further argued that full ownership would streamline decision-making, optimize its business portfolio, and bolster its market position in the strategic region.

Carlsberg did not specify reasons for the sale, announced just days before its annual results. However, financial records reveal a troubled investment. The group recorded a 66 million Danish kroner ($10.47 million) impairment on the Lhasa venture in 2024, following a much larger 244 million kroner write-down in 2021. In its 2021 annual report, Carlsberg cited "disputes" over management that led to "significant operational disturbances" and hurt financial performance.

Background reports from Nikkei Asia indicate the exit path was rocky. Carlsberg had reportedly agreed in 2023 to sell its stake to another entity, Daohe Industry, but Tibet Development exercised its pre-emptive rights, leading to a legal dispute. A court ultimately ruled in favor of the local partner. According to the January filing, Tibet Development settled that related dispute with Daohe for 35 million yuan.

This move reflects a strategic recalibration for Carlsberg in China, potentially focusing resources on core markets and brands, while Tibet Development consolidates its hold on a key regional asset.

Industry Voices

Michael Andersen, Beverage Sector Analyst (Copenhagen): "This is a pragmatic exit from a non-core, problematic asset. The impairments told the story. Carlsberg's China strategy now likely prioritizes stability and scale in more established regions."

Li Wei, Regional Business Consultant (Shanghai): "Full local control could revitalize Lhasa Beer. Tibet Development understands the regional market dynamics and consumer preferences far better than a distant multinational. This could be a positive for the brand's long-term growth."

Emma Richardson, Portfolio Manager (London): "Another example of the operational and political complexities foreign firms face in certain Chinese joint ventures. The lengthy dispute and court case highlight the risks. Shareholders should be relieved Carlsberg is cutting its losses."

David K. Miller, Trade Policy Commentator (Washington D.C.): "This isn't just a business decision; it's a retreat. It underscores the increasingly untenable environment for foreign equity in strategic regions of China. Regulatory and partnership hurdles are pushing foreign capital out, piece by piece."