CVC Capital Partners today announced that Molson Coors Brewing Company (NYSE: TAP; TSX) has signed a definitive agreement with StarBev L.P., owned by funds advised by CVC Capital Partners Limited ("CVC") and StarBev management, to acquire StarBev for €2.65 billion ($3.54 billion). Headquartered in Amsterdam, Netherlands and Prague, Czech Republic, StarBev operates nine breweries in Central and Eastern Europe ("CEE") and generated 2011 sales of nearly €0.7 billion ($1.0 billion) and earnings before interest, taxes, depreciation and amortization (EBITDA) of €241 million ($322 million).
"The acquisition of StarBev fits squarely into Molson Coors' strategy to increase our portfolio of premium brands and deepen our reach into growth markets around the world," said Peter Swinburn, President and Chief Executive Officer of Molson Coors. "The Central and Eastern European beer market is attractive, with strong historical trends and upside potential as the region returns to its pre-economic-crisis growth rates. As a market leader in the CEE region, Starbev provides Molson Coors with a great platform for growth and an excellent foundation from which to extend our key brands, such as Carling, into Central and Eastern Europe. Staropramen will also enhance our portfolio in some of our current and planned markets."
Alain Beyens, CEO of StarBev added: "We are delighted to become part of one of the world's largest brewers. It has been great to work with CVC as we have developed and grown this business over the last few years. Their support has enabled StarBev to become a leading innovator of world-class brands. I am convinced Molson Coors will take StarBev to the next level of development and growth."
CVC invested in StarBev L.P. for it to acquire AB-InBev's CEE brewing assets in December 2009. Since then StarBev has invested heavily in capital expenditure, marketing and brand development to create a highly successful, standalone company. By supporting StarBev to achieve leadership in innovation, CVC helped the company increase market share and grow profitability, despite the challenging economic climate.
István Szőke, CVC Partner and Head of CEE for CVC stated: "We are very pleased with the success of CVC's first investment in the CEE region. Since CVC invested in StarBev in 2009 we have created an innovation driven, highly profitable and cash generative company from a collection of assets during a difficult period economically and for the industry. StarBev is now well-placed for future growth and has a great new home in Molson Coors. The CVC team wishes Alain, Peter and their teams continued success and growth."
StarBev which employs approximately 4,100 people, has brewing operations in the Czech Republic, Serbia, Croatia, Romania, Bulgaria, Hungary, Montenegro and also conducts operations in Bosnia-Herzegovina and Slovakia. StarBev brews approximately 13 million hectoliters annually and holds a top 3 market share position in each of its markets. Starbev's portfolio of more than 20 brands includes local champions such as Borsodi, Kamenitza, Bergenbier, Ozusko, Jelen and Niksicko and also distributes brands such as Stella Artois, Beck's, Hoegaarden, Lowenbrau and Leffe under license.
The transaction is subject to approval by certain European competition authorities and is expected to close in the second quarter of 2012. Following the close, StarBev will be operated as a separate business unit within Molson Coors and will be headquartered in the Czech Republic.
Nomura International acted as financial advisor and Freshfields Bruckhaus Deringer LLP acted as legal advisor to CVC and StarBev L.P.