Asahi offers $1.5b for Independent Liquor

Japan's Asahi Group Holdings is likely to add Independent Liquor to Charlie’s Gourp to become one of the country’s largest liquor and beverage companies.

Reports from Japan says Asahi has won priority negotiation rights from private equity firms Unitas and Pacific Equity Partners to buy Independent for about ¥100 billion yen ($1.5 billion).

The report in the Nikkei business daily says Asahi aims to reach an agreement this week.

Asahi is already closing in on Charlie’s with acceptances so far for about 75% of the shares on the NZX. That deal is worth $130 million.

The move follows a spate of deals by Japanese beverage makers looking abroad for profits as they face sagging domestic consumption and a strong yen.

Asahi in July agreed to buy Malaysian soft drinks company Permanis for $US274 million, while rival Kirin Holdings, which owns Lion in Australia and New Zealand, last week bought a controlling stake in Brazilian beverage maker Schincariol for $US2.6 billion.

Overseas expansion is a crucial component of Asahi's plan to boost group revenues to ¥2-2.5 trillion in 2015 and to generate 20-30% of its sales overseas.

Independent Liquor is the country’s leading producer of ready-to-drink spirits mixes such as Woodstock Bourbon and Vodka Cruiser. It had $414.4 million in revenue last year but recorded a loss of $22.7 million. The firm is eyeing expansion into the US and China.

Independent Liquor is also active in the beer and cider markets, challenging the Lion-DB duopoly with its rebranded Boundary Road Brewery, named after its location at Papakura, Auckland. Boundary also brews global brands Carlsberg, Tuborg and Kingfisher under licence.

It was founded in 1987 Michael Erceg, who died when his helicopter crashed in 2005. The private equity firms paid $1.3 billion for an 80% share while wife Lynne Erceg retained an 11.75% stake. She was listed in the NBR Rich List as being worth $1.5 billion.

Asahi is known for its popular Super Dry beer and already has a foothold in the Australian soft drinks market through Schweppes Australia, acquired in 2009.

It has also entered into an agreement to buy mineral water and juice maker P&N Beverages Australia, that country’s third largest soft drinks company by volume.

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They can see no sign then of our useless government curtailing the marketing of highhol, high sugar drinks to teenagers.

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Maybe the government thinks the useless parents should be doing some parenting.

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More Japanese takeovers are on the horizon...with high YEN value.

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lucky get out of jail card for the PE firm i would have thought - not that long ago the investment was touted as being perhaps only worth $600M - a long way from the initial purchase. the high YEN helps - more likely using the currency as a way to buy up cheap. maybe the sale will help offset all the other disasters on the books at PE land

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