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December 14, 2016

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Asahi drinks to US$7.8b brewing deal

Source: Agencies | December 14, 2016, Wednesday | Print Edition

ASAHI Group Holdings will buy a group of eastern European beer brands from Anheuser-Busch InBev for 7.3 billion euros (US$7.8 billion), boosting its presence in the region in the largest overseas beer deal by a Japanese brewer.

Anheuser-Busch InBev agreed to sell brands including Pilsner Urquell from the Czech Republic, Poland's Tyskie and Lech, Hungary's Dreher and Romania's Ursus to ease clearance from competition regulators for its US$100 billion takeover of SABMiller, finalized in October.

The deal, expected to close in the first half of next year, would be Asahi’s biggest acquisition.

It already bought SABMiller's Italian brand Peroni and Dutch beer Grolsch.

It was announced yesterday morning, less than 24 hours after the deadline for final bids, according to sources close to the matter.

Asahi said yesterday that the business had annual earnings before interest, tax, depreciation and amortization of 493.8 million euros in the year to the end of March.

Based on that figure, its bid represents a multiple of 14.8 times, which is higher than the 12 to 14 times brewing assets in mature markets often fetch.

It paid about 15 times EBITDA for Peroni and Grolsch, fueled in part by synergies with its existing business in Australia.

Asahi was widely seen as the frontrunner in an auction whose first round also included bids from a consortium led by Swiss investment firm Jacobs Holding, Czech investment firm PPF, China Resources and private equity firms Bain Capital and Advent International.

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