Bloomberg News

AB InBev Nears Agreement for Dominican Republic Brewer

April 15, 2012

Anheuser-Busch InBev NV (ABI) is nearing an agreement to gain control of Cerveceria Nacional Dominicana, the Dominican Republic brewer, said two people with knowledge of the transaction.

The move would bring the maker of Presidente beer under AB InBev’s Brazil-based AmBev unit, said the people, who declined to be identified because the negotiations are private. An announcement may come as early as today, they said.

AB InBev, the world’s biggest brewer, is among beermakers seeking to expand in emerging markets and a CND purchase would be the latest in a series of beer deals during the past year. Molson Coors Brewing Co. this month agreed to buy StarBev LP, giving it access to countries such as the Czech Republic, while Kirin Holdings Co., Japan’s largest brewer, last year agreed to buy Brazil’s Schincariol Participacoes e Representacoes.

In the transaction under discussion, AmBev and CND would merge their operations in the Dominican Republic, one of the people with knowledge of the matter said. AmBev would get control of the venture, this person said, while CND’s current owner, Grupo Leon Jimenes, would retain a stake in the business.

A transaction could be worth as much as $2.5 billion, the Wall Street Journal reported on April 11.

Vied With Heineken

Heineken NV (HEIA), the world’s third-biggest brewer, had been vying with AB InBev for CND, a person familiar with the discussions said. Amsterdam-based Heineken owns a 9.3 percent stake in CND, according to Heineken’s website.

Marianne Amssoms, an AB InBev spokeswoman, declined to comment. Spokesmen for AmBev and CND didn’t respond to calls and e-mails sent outside of normal business hours. A Heineken spokesman declined to comment.

AB InBev gained the majority of revenue last year from North America and Latin America and owns the biggest brewer in Brazil, Cia. de Bebidas das Americas, otherwise known as AmBev.

The company has sought to boost sales by introducing Budweiser beer into countries including Russia, China and Brazil, as well as a new variety of Bud Light beer, called Platinum, in the U.S.

AB InBev, based in Leuven, Belgium, was created when InBev NV acquired U.S.-based Anheuser-Busch Cos. in 2008 for $52 billion. AB Inbev fell 58 cents to 54.12 euros in Brussels trading on April 13. The shares have risen 14 percent this year.

To contact the reporter on this story: Jacqueline Simmons in Paris at jackiem@bloomberg.net; Zachary R. Mider in New York at zmider1@bloomberg.net

To contact the editor responsible for this story: Jennifer Sondag at jsondag@bloomberg.net


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