Editor's Viewpoint - Suntory Buys Beam: Surprise Swoop by Japanese Giant
Suntory has agreed to acquire Beam for US$16bn
Come on, then: Hands up, who saw that coming?
Suntory's move for Beam Inc, confirmed earlier today (13 January) has blindsided pretty much everyone in the spirits industry; not so much because it's Beam that is being sold, more that it is Suntory making the move.
Ever since Fortune Brands switched to become a pure-play spirits company in 2011 by keeping only its Beam Global Spirits & Wine division, we on just-drinks have maintained that it was always a matter of when, and not if, the US-based company was to be swallowed up. Pretty much everyone who is anyone in spirits has been linked with Beam at one time or another: Diageo was long thought to be keen on getting a sizeable presence in Bourbon, Pernod Ricard appeared to be hoping that Beam was still available once the French company had restored its post-Absolut debt to more manageable levels. Hell, even United Spirits has made noises.
The most likely scenario appeared to be a bid lodged by two companies, each with complementing interests in Beam's stable.
But, Suntory? No, that probably won't happen.
But, following the Japanese firm's IPO last year, which pulled in about US$3.9bn, Suntory has come into clearer focus as an M&A player. Add in the “fully-committed financing” that the company boasted of in today's statement, and the likelihood of a big buy by Suntory takes on a more comprehensible hue.
Is this the end of the story? Or, can we expect a counter-bid or two, along the lines of earlier speculation? We'll know the answer to these questions very soon: Beam and Suntory expect the deal to close in Q2.
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