On March 5, Anheuser-Busch InBev said it would divest about $7 billion worth of assets to deal with short-term debt after the November Euro-U.S. merger of InBev SA and St. Louis-based Anheuser-Busch Cos., which created the world's No. 1 brewer. It's full debt load after the deal was $45 billion.
Most recently, AB InBev
sold four beverage can manufacturing plants -- not core to its business of brewing -- in the U.S. to Ball Corp. (NYSE:BLL) for $577 million. Ball is a supplier of metal and plastic packaging for beverage, food and household products customers, and of aerospace and other technologies and services, primarily for the U.S. government. It said the acquisition fits well with its strategy to grow its worldwide beverage can business.
AB InBev recently took a bigger chunk off its debt load, agreeing to:
- sell South Korea's Oriental Brewery Co. Ltd. to New York buyout shop Kohlberg Kravis Roberts & Co. for $1.8 billion and
- selling a 20% stake in Chinese brewer Tsingtao Brewery Co. Ltd. to Japan's Asahi Breweries Ltd. for $667 million.
As part of receiving DOJ approval, it also had to sell its Labatt USA unit to KPS Capital Partners LP, relieving fears it would dominate upstate New York's beer market. A sale price was not disclosed.
And a Dow Jones report says AB InBev is seeking binding
bids by mid-July for its Central and Eastern European operations, after CVC Capital Management sent the brewer an unsolicited approach for the businesses. The report said private equity firms such as KKR will likely win the bid as strategics such as Carlsberg A/S and Heineken Holding NV are digesting acquisitions and trying to pay down debt.
Also, to cut costs by
consolidating its network of independent U.S. beer distributors -- and possibly own more of them itself -- a UBS analyst said AB InBev may someday sell as much as 50% of its U.S. beer volume directly to retailers through its own distributors, up from 7% today.
AB-InBev CEO Carlos Brito told shareholders earlier this year that he would sell as many as six businesses. -
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