Asahi Brew to keep 19.99 pct of Tsingtao for 5 yrs

HONG KONG Aug 27 (Reuters) - Tsingtao Brewery Co Ltd (0168.HK)(600600.SS) on Thursday said it has formed a strategic partnership under which Japan's Asahi Breweries (2502.T) will keep a 19.99 percent stake in the Chinese beer maker for the next five years.

The deal, meant to "enhance the profitability and competitiveness" of Tsingtao, makes China's best-known beer brand Asahi's exclusive strategic partner in the brewery business on the mainland, a statement on the Hong Kong exchange website said.

Tsingtao had previously announced a drastic cut in capital spending this year as consumption is expected to drop in a fiercely competitive market. [ID:nHKG100632].

Asahi acquired its current stake in Tsingtao from Anheuser Busch-InBev's INTB.BR nearly 27 percent holdings in Tsingtao in April for $667 million. Anheuser sold its remaining 7 percent stake to Chinese private investor Chen Fashu for $235 million the following month.

Under the latest agreement, Asahi will be allowed to nominate one non-executive director and a supervisor to Tsingtao.

For full company statement, please click: here (Reporting by Nerilyn Tenorio; Editing by Rupert Winchester)