AB InBev's subsidiary Apac raises a further $750 million in its IPO
DURBAN – Anheuser-Busch InBev (AB InBev) subsidiary, Budweiser Brewing Company Apac, has raised $750 million (R11.47 billion), in addition to the $5bn it managed to pull off last week in the initial public offering (IPO).
The group said on Thursday that investors fully exercised an over-allotment option in connection with the IPO of a minority stake of its Asia Pacific subsidiary by selling extra 217.76 million shares.
“Such shares represent approximately 15 percent of the total number of the offer shares finally available under the initial public offering before any exercise of the over-allotment option,” the group said. The shares were sold for HK$27 (R52.66) each.
AB InBev intends to apply all of the net proceeds from the offering to repay its huge debt, part of which emanated from its acquisition of SABMiller for $100bn in October 2016.
The group said upon the full exercise of the over-allotment option, it would control 87.22 percent of the issued share capital of Budweiser Apac.
Budweiser Apac has a portfolio of more than 50 beer brands while AB InBev has more than 500 brands across the globe. Budweiser Apac shares were listed successfully on Monday in Hong Kong and gained as much as 4 percent on the day.
Last week AB InBev revived its failed IPO in Hong Kong by offering 1.26 billion shares of a minority stake of its Asia Pacific subsidiary and raised $5bn on the listing.
The world’s largest brewer initially sought to raise closer to $9.8bn from listing on the Hong Kong stock exchange, but shelved its IPO plans in July “due to several factors which included the prevailing market conditions,’’ as reasons for shelving the IPO.
However, it managed to raise funds in July after it sold its Australian subsidiary Carlton & United Breweries (CUB) to Japan’s Asahi Group Holdings for A$16bn (R164bn).
AB InBev said the transaction represented an implied multiple of 14.9 times 2018 normalised earnings before interest, tax, depreciation and amortisation.
The group said that the transaction was expected to close by the first quarter of 2020.
It said the disposal of CUB would help to accelerate its expansion into other fast-growing markets in the Apac region and globally.
In the quarter to end June, AB InBev reported a 6.2 percent increase in revenue, boosted by its global brands, Budweiser, Stella Artois and Corona. Its revenue increased to $13.9bn during the quarter while net profit increased to $2.8bn.
AB Inbev shares declined 1.63 percent on the JSE on Thursday to close at R1 372.20.