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| InBev May Sell Anheuser Busch Theme Parks to Fund Takeover |
| New York, 13.06.2008 |
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| By Loveday Morris
June 13 (Bloomberg) -- InBev NV may gain as much as $4.4 billion from selling rival brewer Anheuser-Busch Cos.'s theme parks and a packaging business to help fund its proposed takeover, Petercam SA analyst Kris Kippers estimates.
InBev, the world's biggest brewer, yesterday said it plans to raise $8.3 billion by issuing new equity and selling ``non- core'' assets at both companies to finance the $46.3 billion bid.
Selling Busch Entertainment Corp. could fetch about $2.9 billion, Kippers estimates. Anheuser-Busch, which owns Busch Gardens and Seaworld, opened its first theme park in Tampa, Florida, in 1959. The Budweiser brewer now runs 10 sites across the U.S. and is expanding overseas, with four parks planned in Dubai. Busch Entertainment generated $1.3 billion of Anheuser's revenue last year, or 7 percent of the total.
``The entertainment business will go very rapidly after a transaction,'' Wim Hoste, an analyst at KBC in Brussels said by phone yesterday. He has an ``accumulate'' rating on InBev. ``They are a clear candidate for disposal.''
InBev on June 11 said it had made an unsolicited offer for St. Louis-based Anheuser, which said it will consider the bid.
Busch Entertainment accounted for $162.9 million in profit, or 7.7 percent of the total last year. The unit had a $4.7 million net loss in the fourth quarter.
`Challenging Business'
``It's a challenging business,'' said Erin Ashley Smith, an analyst at Argus Research in New York. ``It's very seasonal and a drag on earnings.'' Still, the disposal of the theme parks may be a sticking point, she said. ``Management might be opposed'' as they may have ``ties'' to the unit, Smith said.
Other divestments may include Anheuser's packaging unit, which could be sold for $1.5 billion, Hoste and Kippers estimate. Net income at the division rose 21 percent to $109 million last year.
The packaging division's Metal Container Corp. makes cans and lids for both Anheuser and soft-drink companies, while another arm, Eagle Packaging Inc., makes liners for bottlecaps. Glass-bottle maker Longhorn Glass Corp. and a recycling business are also part of the packaging unit.
``They can easily buy packaging from external parties,'' Hoste said. A sale would free up cash for InBev's balance sheet, which would be ``stretched'' after the acquisition, he said.
Disposals on the InBev side are less obvious as the company has been selling non-essential businesses. The maker of Becks reported 339 million euros ($520 million) in one-time gains last year, mostly from property sales.
`Surprise'
``It was quite a surprise to hear that they are going to do disposals not only at Anheuser-Busch but across the combined entity,'' Petercam's Kippers said by phone yesterday.
There may have been other motivation for saying that both companies shed assets, Hoste said.
``That might create some goodwill amongst Anheuser investors, whether they will or not is another question,'' Hoste said. ``They have to gain some confidence.''
To contact the reporter on this story: Loveday Morris in London at lmorris7@bloomberg.net
www.bloomberg.com |
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Address : Euro-Brew Ltd., Hlboká 22, 917 01 Trnava, Slovakia
Tel. : +421 33 53 418 53, Fax : +421 33 53 418 52, E-mail : info@eurobrew.sk |
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