MOLSON COORS, the US brewer whose brands include Coors Light and Carling, has struck a deal to buy StarBev, the eastern European beer maker, for €2.65 billion.
The move will help the US brewer’s launch into growth markets as it seeks to extend sales beyond its core territories of the US, Canada and Britain.
“The acquisition of StarBev fits squarely into Molson Coors’ strategy to increase our portfolio of premium brands and deepen our reach into growth markets around the world,” said chief executive Peter Swinburn. “The central and eastern European beer market is attractive, with strong historical trends and upside potential as the region returns to its pre-economic-crisis growth rates.”
The brewer is planning to use StarBev, whose flagship brand is Staropramen, as a platform for growth and to sell brands such as Carling in central and eastern Europe.
The US brewer expects the deal to be accretive to earnings in the first full year of operations and to generate about $50 million of pre-tax operational synergies by 2015. “It moves them forward and gives them a new lease of life,” one industry specialist said.
One person familiar with the sale said yesterday the deal would yield several times what CVC invested in the company, and that the disposal was in response to interest from strategic bidders.
Anheuser-Busch InBev, which sold the business to CVC in 2009, had the right of first offer to reacquire the business if CVC chose to sell StarBev, and was among those considering a bid. With its headquarters in Amsterdam and Prague, StarBev operates nine breweries and generated 2011 sales of about €700 million and earnings before interest, taxes, depreciation and amortisation of €241 million.
According to Molson Coors, the purchase price represents a multiple of approximately 11 times enterprise value to Ebitda.
StarBev was formed by CVC when the fund in 2009 bought the central European operations of ABI for up to $3 billion, following the $52 billion merger of the US and Belgian companies that formed the world’s largest brewer. – Copyright The Financial Times Limited 2012
