Asahi buys AB InBev assets in Eastern Europe for US$7.7 billion


TOKYO — Asahi Group said Tuesday it will pay about US$7.7 billion for AB InBev’s beer assets in five Eastern European countries, its biggest-ever overseas deal as the Japanese brewer expands its presence in Europe. The purchase — also the largest by a Japanese beer company — includes popular Czech beer Pilsner Urquell and other businesses in Hungary, Poland, Romania and Slovakia. In April, Super Dry-maker Asahi said it would buy the Peroni and Grolsch brands from the world’s top brewer AB InBev, clearing the way for the Belgian company’s monster US$121 billion takeover of Britain’s SABMiller. The European businesses that Asahi announced it was buying were formerly owned by SABMiller before it became part of AB InBev, which owns Corona, Beck’s, Budweiser and Stella Artois. As part of that merger deal, European regulators had demanded AB InBev sell the Peroni and Grolsch brands, and divest SABMiller’s Eastern European business. “The target business is highly compatible with our existing business in western Europe and will strengthen our business platform, allowing Asahi to grow sustainably across Europe,” the Japanese brewer said in a statement.

Investors, however, dumped Asahi’s Tokyo-listed shares in response to a report on the acquisition earlier Tuesday from Japan’s leading Nikkei business daily. The paper said Asahi would pay roughly US$7.7 billion for the units, about twice as much as it had said in an earlier report back in October. The stock dived 4.60 percent to end the day at 3,497 yen before the deal was officially confirmed. “The shares were down over concerns about the higher price” Asahi was paying, said Nobuyuki Fujimoto, a senior market analyst at SBI Securities in Tokyo. “But in the longer term it could be a good strategy since Japanese brewers need to be in foreign markets to survive.” Asahi has long been a minnow abroad — only about 12 percent of its 1.87 trillion yen in annual sales came from overseas consumers. It is best known overseas for a beer brand called Super Dry, which debuted in 1987 at the height of Japan’s boom years, before a stock market and property crash ushered in a slow economic decline. Japanese firms have been shopping abroad for years to counter a shrinking market at home and have faced a slump in beer sales as younger people lose interest in the country’s well-known business drinking culture. Last year, Asahi rival Kirin acquired control of Myanmar’s biggest brewer, tapping the fast-growing Southeast Asian market. In 2014, drinks giant Suntory said it would pay about US$16 billion for the U.S. firm behind Jim Beam bourbon in one of the biggest-ever overseas acquisitions by a Japanese company.