Asahi agrees to pay $7.81bn for SAB Miller’s East European brands

Asahi Group Holdings, the Japanese brewer and soft drinks manufacturers,  yesterday agreed in principle to acquire Anheuser-Busch InBev’s operations in five Eastern European countries for around $7.8bn, three months after the Belgium-based brewer and beverage company took control of the assets after its $100bn merger with SAB Miller.
The deal, which will include the Czech Republic’s iconic Pilsner Urqull brand, is set to go down as one of the biggest acquisition of overseas brewing operations by a Japanese company. AbInBev’s sale of SAB Miller’s East European assets – which also include two other Czech-based brands in Velkopopovický Kozel  and Radegast, the Šariš  and Topvar breweries (Slovakia), Tyskie (Poland), Ursus, (Romania) and  Dreher (Hungary) – was a precondition of the European Commission’s approval of the merger.
Asahi saw off rival bids from both Western private equity funds and Chinese brewers, and regards the acquisition as a platform from which to expand its global operations. Two months, ago it also bought SAB Miller’s western European Peroni and Grolsch brands, and acquisitions are part of its efforts to offset slow growth in its home market.
According to statement released by the company this week, the acquisition will lift its overseas sales as a proportion of total sales  from 16% in October to almost 25%. With the Polish market in particular characterised by heavy discounting and stiff competition, however, question marks remain over the premium price that Asahi is seen to be paying for its market entry.

Source: nikkei