Czech Republic: Pilsner Urquell becomes Japanese

Less than 24 hours after expiration of the deadline for bids for the former SABMiller breweries in Eastern Europe, AB InBev has announced the buyer of brands like Pilsner Urquell (Czech Republic), Tyskie and Lech (Poland), Dreher (Hungary), Ursus (Romania) and Topvar (Slovakia). Asahi  Group Holdings, which were traded beforehand as the favourite in the bidding process buys the entire package for  €7.3 billion ($7.8 billion), which is more than expected. The price/earnings multiple of 14.8 comes close to the 15, which Asahi paid for Peroni (Italy), Grolsch (Netherlands) and Meantime (United Kingdom) earlier this year but seems to many expert very ambitious in saturated markets. After the deal was announced Asahi’s share price fell today 6% but recovered to -4.6% upon closing.

The deal brings Asahi’s president and CEO Naoki Izumiya closer to his goal to be more independent from ailing Japanese beer market.  Overseas sales of the Japanese brewer have been 16% so far and will be lifted to nearly one quarter. According to Nikkei Sangyo Shimbun newspaper, Asahi led the Japanese beer market in 2014 with a 38% market share followed by Kirin with 35%, Suntory with 15%, Sapporo with12% and Orion with 1%.

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