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    Friday, July 19, 2019

    AB InBev Sells Australia Unit Following Failed IPO

    AB InBev announced on Friday the sale of its Australian business unit, Carlton & United Breweries to Japanese brewer, Asahi for US$11.3bn.

    The sale follows AB InBev’s failed Initial Public Offering (IPO) of its Asian business unit, Budweiser Brewing Co APAC due to weak investor demand.
    The deal will allow AB InBev to dispose of a low-growth business unit while acquiring cash to start paying down its huge debt of over US$100bn, piled up from its acquisition of SABMiller in 2016.

    For Asahi, the deal gives it a strong foothold in Australia, where it was lagging behind AB InBev and Japanese brewer Kirin. Carlton and United Breweries brands account for nearly half of Australia’s beer market. The sale also marks Asahi’s move to pursue growth outside of its shrinking Japanese home market. It would also be the third time the Japanese brewer would acquire assets owned by AB InBev.

    It acquired several assets and brands from AB InBev in Europe in 2016 as part of the European Anti-trust Commission’s requirement to allow the merger between AB InBev and SABMiller to go forward.
    “The divestiture of Carlton & United Breweries (CUB), once completed, will help AB InBev to accelerate its expansion into other fast-growing markets in the APAC region and globally,” the company said.

    Carlton & United Breweries became part of AB InBev’s business empire following the brewer’s acquisition of SABMiller in 2016.
    Following its failed bid to raise cash through an IPO last week, the Belgian brewer signaled it might return to the idea “provided that it can be completed at the right valuation”.
    The transaction is expected to close by the first quarter of 2020.
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