St. Vincent Brewery under new control

Controlling shares in St. Vincent Brewery Ltd. are expected to change hands from Royal Unibrew A/S to Cerveceria Nacional Dominicana (CND) by early next year.{{more}}

Press releases from CND and Royal Unibrew A/S received on Wednesday indicate that Cervecería Nacional Dominicana (CND) has entered into a US$31 million purchase agreement for Royal Unibrew A/S controlling stakes in its beer, malt, soft drink and water operations in Saint Vincent, Antigua and Dominica.

CND is the leader in the Dominican Republic’s beer and malt markets and Royal Unibrew A/S is a Danish publicly traded company with operations in Denmark, Poland, Lithuania, Latvia and the Caribbean.

This transaction, which falls within CND’s strategic plans, will result in the acquisition of 76.5% of Saint Vincent Brewery Ltd, 93% of Antigua Brewery Ltd., 75% of Antigua PET Plant Ltd., and 58% of Dominica Brewery & Beverages Ltd.

These companies, leaders in their respective markets, currently own or license beer brands such as Hairoun, Wadadli, and Kubuli, Guinness stout, Vitamalt, soft drinks, and Duna and Loubiere waters.

“The agreement also covers a license for the production and commercialization of Vitamalt, Royal Unibrew’s global premium malt brand,” CND’s release said.

“The agreements with CND, which is the market leader in the Dominican Republic, comprise … partly an agreement for licence production and sale of Vitamalt at all the divested breweries and in the Dominican Republic. The introduction of Vitamalt in the Dominican Republic means that, for the first time, Vitamalt will be distributed in a major, Spanish-speaking market in the region,” the release from Royal Unibrew said.

This acquisition strengthens CND’s position as a regional producer in the Caribbean. In addition, CND will continue to develop its operations in the Dominican Republic.

The release from Royal Unibrew’s said that the sale will reduce Royal Unibrew’s interest-bearing debt by just below DKK 200 million, and that the selling price of the shares is equal to their carrying amount. The release added that the purchasers will take over the debts of the companies.

Royal Unibrew’s release also said, “As mentioned in the Announcement of Annual Results for 2008, a reduction of the Group’s debt level is a strategic main priority, and the agreement entered into to sell the Caribbean breweries is a result of the initiatives launched to achieve this.”

The transaction is subject to customary conditions including approval by the government in Antigua and the attainment of certain licensors’ acceptance of the change in ownership. The transaction is expected to close no later than February 2010.