US: Anheuser-Busch InBev sells US Labatt arm

By | 23 February 2009

Anheuser-Busch InBev has agreed a deal to sell its InBev USA business, the distributor for Labatt beer in the US, to private equity group KPS Capital Partners.

InBev put the New York-based business up for sale last autumn in order to gain regulatory approval in the US for its US$52bn takeover of Anheuser-Busch (A-B).

A-B InBev has not disclosed a fee for the deal with KPS Capital, announced today (23 February). Analysts have priced the Labatt USA business at around $300,000.

The brewer said that the deal, which is subject to regulatory approval, includes an exclusive licence to brew Labatt for the US market, as well as market and distribute the beer.

Labatt headquarters in Canada will, however, brew and supply Labatt beer for the US for a further three years, in a "transitional supply agreement", A-B InBev added.

For KPS Capital, the Labatt deal marks the group's foray into brewing.

The firm today announced the formation of North American Breweries, its investment vehicle for the beer and malt beverages sectors.

The group said that, as well as Labatt USA, it has agreed a deal to buy New York-based High Falls Brewing Co.   

It has also gained the licence for Seagram's Cooler Escapes and Seagram's Smooth brands from Pernod Ricard USA. Fees for the deals were not disclosed.  

KPS partner Raquel Palmer said: "We intend to continue to grow North American Breweries aggressively, both organically and through acquisition of new brands and exceptional breweries."

Co-founder and managing partner Michael Psarsos told the Mergers & Acquisitions trade journal this month that the group "ducked" deals in 2008 in order to capitalise on "buying opportunities" emerging from the financial crisis.

Sectors: Beer & cider

Companies: InBev, Anheuser-Busch, Pernod, Ricard

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