UK/Japan: Fuller's Brewery sold to Asahi

Fuller, Smith & Turner (Fuller's), a regional, family-run 300,000 hl brewery, founded in 1845 in Chiswick, West London, England, announced today that it has entered into an agreement for the sale of its entire beer business to Asahi Europe, a wholly owned subsidiary of Asahi Group Holdings for an enterprise value of £250 million (US$327m) on a debt free, cash free basis. The price represents a 23.6 EBITDA multiple according to Fuller’s. The deal is expected to complete in the first half of the year.

The business, which will complement Asahi’s other European operations acquired in 2016 following the sale of SABMiller to AB InBev (, 28.9.2016), comprises the entirety of Fuller’s beer, cider and soft drinks brewing and production, wine wholesaling, as well as the distribution thereof. It also includes the Griffin Brewery in Chiswick, where the company was founded, as well as Cornish Orchards, a cider and juice company based at Duloe, Cornwall, Dark Star Brewing, a brewery in Partridge Green, Sussex which was acquired in February 2018, and Nectar Imports, a supplier of beers, wines, spirits, soft drinks and other drink-related products to restaurants, bars, and nightclubs based in Berwick St Leonard, Wiltshire.

Asahi will acquire the brands of the beer business including the London Pride brand and will receive the benefit of a licence, on a perpetual, global, exclusive and royalty-free basis, to use certain trademarks including the signature Fuller’s name, logo and cartouche for the provision of beverages. However, ownership of the licensed trademarks will be retained by Fuller’s.

Not part of the deal is also Fuller's pub and hotel business. The company owns and operates nearly 400 pubs, inns and hotels across the south of England, with about the half being managed pubs and hotels, and the rest being tenanted pubs.

In a press release Fuller’s said that the company “will be a focused, premium pub and hotel operator pursuing its previously stated strategy of running a stylish, high quality estate, with well-located, well-invested, predominantly freehold sites that are maintained to the high standards that customers have come to expect. Fuller’s will form a strategic alliance with Asahi that will ensure continued access to the high quality premium beer brands Fuller’s has always brewed.”

In 2016, Asahi Group Holdings bought SABMiller’s former European business from AB InBev. In a first step Asahi acquired SAB Miller’s former brands Peroni, Grolsch and Meantime and the associated businesses in Italy, the Netherlands and the UK for EUR 2.55 billion (US$2.7b) on a debt free/cash free basis (, 11.10.2016). In a second step, Asahi also bought SABMiller’ Eastern European breweries including brands like Pilsner Urquell (Czech Republic), Tyskie and Lech (Poland), Dreher (Hungary), Ursus (Romania) and Topvar (Slovakia) for  EUR 7.3 billion (US$7.8b) (, 13.12.2016). One year later, Akiyoshi Koji, president of Asahi, said the Japanese brewer was also interested in some "bolt-on" acquisitions to boost the European businesses (, 24.9.2017).

Net cash proceeds of the deal are expected to be approximately £205 million (US$269m). A return of proceeds between £55 million (US$72m) to £69 million (US$90m) of the net cash proceeds is expected to be distributed to ordinary shareholders.

Simon Emeny, Chief Executive of Fuller’s, commented: “This deal secures the future of both parts of our business including protecting the heritage of the Griffin Brewery in Chiswick, which was particularly important to the Fuller’s Board. We remain incredibly proud of the Fuller’s Beer Business, its history and the high quality premium beer and cider portfolio that we have developed. Brewing has formed an integral part of our history and brand identity, however the core of Fuller’s and the driver of our future growth is now our premium pubs and hotels business.”

Akiyoshi Koji, CEO of Asahi Group Holdings, Ltd, commented: “We have long admired the brewing business and exceptional beer brands that Fuller’s has built over the years and the high degree of respect it commands throughout the global beer industry. Fuller’s is one of the few brewers that show the same genuine commitment to brewing excellence and quality that we do. We strongly believe that the brands of the Beer Business, including London Pride, Frontier and Cornish Orchards among others, complement our premium portfolio in the UK market. In particular, London Pride is a fantastic brand with an illustrious heritage dating back to the 1950s and we are excited about its untapped international potential which Asahi has the scale and global network to unlock.”

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