AB InBev sale of Carlton in Oz lifts its share price to R1311
The world's largest brewer's share price cheered the latest developments and gained more than 6percent on the JSE to R1311 a share, up from Thursday's closing price of R1234.63.
AB InBev shelved the IPO of a minority stake in its Asia-Pacific subsidiary, Budweiser Brewing Company Apac, on the Hong Kong Stock Exchange, which would have netted as much as $9.8bn (R136.23bn) for the group, due to several factors which included the prevailing market conditions.
However, the agreement with the Asahi Group has filled the void with the group expected to use the proceeds of the CUB to cut down its reported $106bn debt.
AB InBev said the transaction represented an implied multiple of 14.9 times 2018 normalised earnings before interest, tax, depreciation and amortisation.
“As part of this transaction, AB InBev will grant Asahi Group Holdings rights to commercialise the portfolio of AB InBev’s global and international brands in Australia,” the group said.
The Asahi Group has committed financing in place and the transaction is subject to customary closing conditions including regulatory approvals in Australia.
The group said that the transaction is expected to close by the first quarter of 2020. The disposal of CUB, once completed, will help AB InBev to accelerate its expansion into other fast-growing markets in the Apac region and globally.
AB InBev chief executive Carlos Brito said they continued to see great potential for their business in Apac and the region remained a growth engine within its company.
“With our unparalleled portfolio of brands, strong commercial plans and talented people, we are uniquely positioned to capture opportunities for growth across the Apac region,” Brito said.
Jordan Weir, a trader at Citadel, said the disposal of AB InBev’s Australian operations would definitely assist the company in chipping away at its debt pile.