Lion Brewery, a wholly-owned Australian subsidiary of Japanese brewer Kirin Holdings Co Ltd, has agreed to acquire Little World Beverages, owner of 'Little Creature' brand of beer, for approximately A$382 million.

Lion already holds around 36-per cent stake in the Fremantle, Western Australia-based boutique brewer founded in 2000.

Under the terms of the deal, Little World Beverages shareholders will get A$5.30 per share in cash, subject to successful implementation of the scheme. The offer values Little World at around A$382 million, Lion said in a statement.

The offer price represents a 40-per cent premium to the closing price of A$3.79 of Little World Beverages' shares on 15 June, on the Australian Stock Exchange (ASX).

Further to the announcement of the deal, shares in Little World Brewers shot up 36 per cent to close at A$5.16 yesterday on the ASX.

The proposed scheme will be implemented subject to approvals from the ASX and Foreign Investment Review Board, as well as consent of the shareholders of Little World and other customary closing conditions, Lion said.

The company intends to hold a shareholders' meeting to approve the scheme in October 2012.

In addition to Little Creature, Little World Brewers' key brands include White Rabbit and Pipsqueak Cider. The company operates a brewery in Fremantle, Western Australia and another one in Healseville, Victoria. A third brewery is one under construction in Geelong, Victoria. The brewer also operates three hospitality venues.

The board of directors of Little World Brewers has unanimously agreed to the deal.

Lion's chief executive officer Rob Murray said, ''This is a very compelling offer for Little World Beverages shareholders and we are pleased the Little World Beverages board has agreed to recommend it to its shareholders.''

The offer price is 23 times multiple of Little World's FY11 earnings before interest, taxes, depreciation and ammortisation which is comparable to similar transactions in the beverages sector, according to Lion.

''We believe there is now a fantastic opportunity through Lion's scale distribution system to get these great brands to more beer lovers, while respecting the craft brewing ethos of the Little World Beverages brands, breweries and hospitality venues,'' Murray added.

Little World Beverages' chairman Ian Cochrane said the deal announced yesterday marked a significant milestone for the company.

Little Creatures team has built ''an iconic brand in the Australian beer market that can further expand with the expertise and greater reach of Lion,'' he said.

Sydney-based Lion is a leading beverage and food company with a portfolio of many favourite products in Australia and New Zealand that include beer brands Tooheys, XXXX, Speight, and Hahn, spirits, wine, milk and diary products and non-alcoholic beverages.

The company was formed under the name 'Lion Nathan National Foods' when Kirin Holdings acquired Lion Nathan and merged the business with its National Foods in 2009. Since 2011, it is known as Lion.

Lion, with revenue of around A$5 billion employs nearly 7,500 people across Australia and New Zealand.

Greenhill Caliburn is acting as financial adviser to Lion on the deal.