Kirin in talks to acquire 100% of Lion Nathan

Kirin in talks to acquire Lion Nathan in bet on beer in downturn

By Jonathan Underhill

April 23 – Kirin Holdings Co., Japan’s largest beverage company, is in talks to acquire the remaining shares in 46.1%-owned Australian brewer Lion Nathan Ltd., betting demand for beer won’t falter as economic growth slows.

The remaining shares of Lion are worth A$2.39 billion, based on the stock’s A$8.31 trading price before being halted for the talks. Kirin made “an indicative, non-binding, conditional and confidential proposal” to acquire the outstanding shares of Lion, the Australian brewer said in a statement today. The shares will be halted until Monday.

In February, Lion dropped a takeover offer for Coca Cola Amatil and reiterated its forecast for full-year net operating profit of A$300 million to A$315 million, saying its business is in “robust shape.” Last month, Fitch Ratings raised Lion’s long-term credit rating to BBB+ from BBB, saying the upgrade reflected “the strong strategic ties between Lion and Kirin” and the strength of Lion’s underlying business profile.

Lion’s brands include Steinlager, Lion Red, Speight’s, Macs, XXXX, Tooheys, Becks and Hahn beers, as well as St Hallett and Petaluma wines and McKenna bourbon.

Kirin is expanding its holdings in the Asia Pacific region, with plans to acquire up to 49% of the Philippines’ San Miguel Brewery, the biggest food and drinks company in Southeast Asia. San Miguel this month posted an 8% gain in first-quarter profit.

At the same time Kirin it exiting France’s Pernod Ricard, the world’s second-largest liquor group, agreeing to sell its3.74% stake to founding investors the Ricard family.

Shares of Kirin have declined 42% in the past 12 months and were last at 1078 yen.

(Businesswire)

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