InBev plans £1bn deal
Belgian brewer InBev is planning to put its South Korean beer business up for sale, sources said yesterday.
The move is an effort to shed a noncore asset and raise what could be roughly £1bn for its purchase of US brewer Anheuser-Busch.
Deutsche Bank and JPMorgan Chase will run the auction for the business, called Oriental Brewery, said the sources, who were briefed on the matter. But the auction is not likely to start until the closing of InBev’s planned £26.1bn takeover of Anheuser-Busch which is set to make it the world’s largest brewer.
“Financing for the combination with Anheuser-Busch includes a $7bn bridge financing for divestitures of noncore assets from both companies,” a spokeswoman for InBev said. “However, we cannot comment at this stage on which businesses specifically would be considered,” she added.
Oriental Brewery sold 182.3m gallons of its product in 2007, which includes global brands Becks, Stella Artois and Cass beers, a figure which led sources to estimate the rough £1bn price tag. It became part of InBev’s operations in 1998 and merged with Cass Brewery in 2001, according to a company fact sheet. The business is South Korea’s second largest brewer behind Hite Brewery.
InBev’s decision to sell Oriental comes at a time of high saturation in the South Korean beer market, and after long-time speculation by analysts and experts that the Belgian brewer might spin off its Korean unit. Japanese brewers Kirin and Asahi may be among the interested bidders for the unit, sources said.