C&C Group, the maker of Magners cider, agreed to buy Anheuser Busch InBev NV’s Irish and Scottish assets, including the Tennent’s beer brand, for £180 million (€205 million) to strengthen its distribution.
The acquisition from AB InBev, the world’s biggest brewer, is expected to immediately boost earnings per share and deliver cost savings and revenue synergies of £10 million a year by 2012, Dublin-based C&C said in a statement.
The Irish company will also get the rights to distribute AB InBev beer brands including Stella Artois in Ireland, Northern Ireland and Scotland.
C&C said Tennent’s is Scotland’s leading lager brand, accounting for 55 per cent of lager shipments to pubs by volume and half the sales through retailers.
AB InBev has been selling assets to repay debt stemming from the $52 billion merger that formed the company last year.
The purchase “provides a strengthened route to market for Magners cider in both Northern Ireland and Scotland,” C&C said.
C&C also reaffirmed its full-year profit target, saying the cider division’s performance was “encouraging” in the five months through July, with revenue down 4 per cent excluding currency swings.
The beverage maker last month slashed its sales forecast, saying it expected a 5 per cent revenue drop for the first four months of its financial year, excluding currency effects, as consumer spending suffered.
C&C will fund the deal from its cash and existing loan facilities. The acquisition is subject to shareholder approval and regulatory consent.
Bloomberg