Japan/Australia: Asahi borrows USD 11 billion for CUB takeover

Asahi Group Holdings said today it had signed an agreement with Sumitomo Mitsui Banking Corp for a 1.185 trillion yen (USD 11 billion) loan to buy Carlton & United Breweries (CUB) from Australia. The purchase from AB InBev at a purchasing price of AUD 16.0 billion (USD 11.3 bn) in enterprise value which was already announced in July last year (inside.beer, 19.7.2019) is set to close on June 1.

Asahi originally planned to complete the acquisition in the first quarter, but announced in March that the deal would be delayed, as the companies were still awaiting approval from the Australian Competition and Consumer Commission (ACCC) amid the coronavirus pandemic.

In the beginning of April, the ACCC finally approved the deal after Asahi agreed to sell the beer brands Stella Artois and Beck’s and the cider brands Strongbow, Bonamy’s and Little Green to a buyer to be approved by the ACCC (inside.beer, 1.4.2020).

CUB will become a business division of the Asahi Beverages, the Oceania regional hub of Asahi Group Holdings, alongside other business divisions. Asahi Beverages so far comprises of three trading Business Divisions, namely Asahi Lifestyle Beverages which manufactures, markets and distributes a broad portfolio of leading non-alcohol beverage brands, Asahi Premium Beverages which manufactures, markets and distributes a broad portfolio of alcohol products in Australia and Asahi Beverages New Zealand, which manufactures, markets and distributes a broad range of beverage products in New Zealand.

The combined business of CUB's 45 per cent share and Asahi’s already existing business in Australia will have about 48.5 per cent share of the Australian beer market and will make it the country's biggest brewer.

Speaking in July last year Peter Margin, Executive Chairman of Asahi Beverages, said “locally, for the Asahi Beverages business this deal is hugely attractive. It will give us scale in our alcohol business to complement our non-alcohol business, and it also brings quality assets, manufacturing capability and great people, with strong marketing expertise.

“I can see a terrific future for the combined organization,” he added.

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