The Austrian drinks group BBAG is on the look out for a partner to help it become Central Europe’s largest brewer.
The company, which has been in acquisitive mood since 1991, buying up 14 foreign breweries, said it had already invited possible partners to submit concrete proposals. Any deal, it said, would include all of its divisions, notably beer, non-alcoholic beverages and real estate.
Already the market leader in Austria and Romania and in the top three in Hungary, with brands such as Goesser and Zipfer beers and Pago fruit juices, BBAG will be of interest to a number of Europe’s international concerns.
“Undoubtedly, all of the major brewers should be interested in such a deal,” WestLB Panmure beverage analyst Stuart Price said. “Synergies range from €15/share for Carlsberg, virtually zero for Scottish & Newcastle (S&N) and €35 for SAB and Heineken.”
He went on: “There could be regulatory issues in Hungary only (where Interbrew, SAB, and BBAG have similar market shares. Though the exact form of the strategic alliance is very much open, the danger is that BBAG may want equity – as did the Hartwall family with S&N – and this could prove EPS dilutive.
“Although cash-constrained, S&N cannot be ignored – it could prove to be (S&N CEO) Brian Stewart’s swan-song deal and it already has a licensing deal with BBAG for Zipfer.”
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In a statement BBAG said: “The first contacts have encouraged us to continue our deliberations about a possible long-term partnership..
“As we see it today, we would in principle not exclude a different shareholder structure, including the possibility of a change of ownership,” it added.
BBAG has a 29% market share in Hungary; 34% in Romania and 56% in Austria; 6% in
Poland and 2% in Czech.
