AB InBev acquires remaining stake in Craft Brew Alliance

Beer giant AB InBev has performed a u-turn after turning down a deal to acquire the rest of Craft Brew Alliance in August, announcing the purchase of the whole company in an estimated US$321 million deal.

The global brewer announced yesterday (11 November) that it was to acquire the remaining stake in Craft Brew Alliance (CBA) for $16.50 per share, over double the $7.33 per share price at the close of trading last night.

AB InBev currently owns a 31.2% stake in CBA, which it acquired in January 2013.

In August, it rejected a deal to buy CBA outright. The initial deal stated that by 23 August, AB InBev either had to buy CBA for US$24.50 per share, equating to around $500m, or make a $20m payment. It opted for the latter.

Commenting on the revised purchase, Andy Thomas, CEO of CBA, said: “Anheuser-Busch has a long track record of working with its craft partners to help make the US beer category stronger and more vibrant.

“The announcement represents an exciting next step in a long and successful partnership with Anheuser-Busch, whose support for the growth of our business and brands traces back over 25 years.

“By combining our resources, our talented teammates, and dynamic brands, we will look to nurture the growth of CBA’s existing portfolio as we continue investing in innovation to meet the changing needs of today’s beverage consumers, all while delivering certainty of value to our shareholders.”

Upon completion of the deal, which pending closing conditions and regulatory approval is expected to close in 2020, CBA will become part of AB InBev’s Brewers Collective, formed of acquired craft beer brands. These include Goose Island, Elysian and 10 Barrel.

In the last three years, AB InBev has invested over $130m in the business unit, allowing members to expand production by an average of 31%.

Michel Doukeris, CEO of AB InBev, said: “Our partnership with CBA goes back many years and we look forward to supporting CBA as they continue to bring great products to beer drinkers across the US.”

Based in Portland, Oregon and founded in 2008, the CBA is a collection of craft brewing brands including Kona Brewing, Appalachian Mountain Brewery, Cisco Brewers, Omission Brewing Co., Redhook Brewery, Square Mile Cider Co., Widmer Brothers Brewing, and Wynwood Brewing Co. Beers produced by the group are available in all US states and in 30 countries around the world.

Business, Entrepreneur, Estate, Family, Next Generation, Startup, Succession, Wealth