SABMiller shortlists five bidders for Peroni and Grolsch European beer brands

23 Jan 2016


Five bidders including two brewers and three private equity firms have moved to the final stages of an auction to buy SABMiller's Peroni and Grolsch European beer brands, valued at more than €2 billion ($2.2 billion), Reuters yesterday reported, citing several sources with knowledge of the matter.

Asian brewers Asahi Group Holdings and Thai Beverage, and private equity firms PAI Partners, Bain Capital and European buyout fund EQT have been shortlisted to the next round of bidding, the report said.

All final bidders are expected to table binding offers in mid February, the report added.

Last week the Japanese daily Yomiuri reported that Japan's beverage maker Asahi Group Holdings Ltd is expected to table a bid for around $3.41 billion. (See: Japan's Asahi Group expected to table $3.41-bn bid for two SABMiller brands)

The Asian brewers have a better chance to wrap up the deal since they can get cost savings from merging both brands into their existing business and also avail of cheaper funds.

Anheuser Busch InBev SA has been seeking potential buyers for Grolsch and Peroni in order to get European regulatory approval for its proposed acquisition of arch rival SABMiller for around $104 billion. (See: Anheuser-Busch InBev raises informal offer for SABMiller to £43.5 per share)

Anheuser Busch InBev, which owns Stella Artois, Budweiser and Corona, has already struck a deal to sell SABMiller's 58-per cent stake in MillerCoors to Molson Coors for $12 billion in order to allay competition concerns in the US and is expected to be forced to sell its market-leading Snow brand in China.

Peroni and Grolsch are among the best-known brands in Europe and the brands could be valued at 11 to 12 times earnings before interest, taxation, depreciation and amortisation.

Dutch Grolsch beer was founded in 1615 while Italy's Peroni has been produced since 1846, according to SABMiller's website.

The combined value for Peroni and Grolsch is around €1.8 billion ($2 billion), based on earnings before interest, taxes, depreciation and amortization (EBITDA) of €120 million to €150 million.

Asahi Group, Japan's biggest beer maker with a 38n per cent market share, has recently been looking at expanding overseas through strategic acquisitions because of stagnant demand in the local market due to an aging population.

Its recent acquisitions include Australia's Schweppes and Flavoured Beverages Group Holdings, and the water and juice businesses of P&N Beverages Australia Pty Ltd, New Zealand's Independent Liquor, and Charlie's Group Ltd, a fruit juice producer, a stake in China's Tsingtao Brewery and Malaysia-based PepsiCo bottler Permanis Sdn.

A successful bid would allow the Tokyo-based brewer to build a larger presence in Europe.

Thai Beverage, also known as ThaiBev and controlled by Thailand's second-richest man Charoen Sirivadhanabhakdi, is an aggressive acquirer.

He successfully wrangled an $11 billion deal in 2013 to take control of Singapore-listed Fraser and Neave (F&N) by outbidding Heineken NV, the world's third-largest brewer.

Sirivadhanabhakdi holds vast assets, including hotels in Bangkok, Kobe, Hanoi, Singapore and New York, and beverage business of fruit juices and bottled water.

ThaiBev has 116 subsidiaries, including 18 distilleries, 3 breweries and 10 non-alcohol beverage production facilities.

The Group has an extensive distribution network covering 400,000 points of sales in Thailand.

Its most recognised spirits brands include Ruang Khao, SangSom, Mekhong, Hong Thong, and Blend 285.

ThaiBev has an international presence in 90 countries and has five production facilities in Scotland, which are famous for the production of single malt scotches such as Balblair, Old Pulteney and Speyburn.

ThaiBev also owns 1 distillery in China, which produces a famous Chinese spirit branded Yulinquan.

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