BRAZIL/CANADA: AmBev sells Bavaria to Canada's Molson Inc.
AmBev - Companhia de Bebidas das Americas (NYSE: ABV) announces that on Nov. 6, it concluded negotiations to sell the Bavaria S/A company to Canada's Molson Inc. The divestiture of the Bavaria brand and five plants was a condition made by the "Conselho Administrativo de Defesa Economica" - Cade (Administrative Council for Economic Defense) on March 30 to secure the approval for the merger between the Antarctica and Brahma breweries. In addition to this, AmBev will have to share its Antarctica retail distribution network with Molson.Molson purchased Bavaria for US$213 million, of which US$98 million was paid upon the business conclusion and the remaining amount is conditioned upon the company's performance. The business includes the selling of two former Antarctica plants in Ribeirao Preto, Sao Paulo and Getulio Vargas, Rio Grande do Sul and three Brahma plants in Cuiaba, Mato Grosso; Manaus, Amazonas; and Camacari, Bahia. All of these units received during the last few months, investments of R$17 million, and are currently fully operational and already making the Bavaria beer. The Ribeirao Preto unit, which already had a bottle production line, started up a can production line, to comply with the Cade's ruling.In order to make both the brand and the selling of assets feasible, AmBev has incorporated the Bavaria S/A company, which is being handed to the purchaser without financial liabilities. Bavaria S/A has an installed capacity to make 7 million hectoliters. Molson is Canada's largest brewery, holding a 45% share of the market.
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