Netherlands’ Heineken has obtained the approval of the Egyptian Capital Market Authority to make a public offer for up to 100 percent of the issued shares of Al-Ahram Beverages Company (ABC) in Egypt.
The offer price is $14 per share, resulting in a total acquisition price of $287 million if 100 percent of the shares are offered to Heineken. The offer is conditional upon Heineken acquiring at least 76 percent of the shares. The public offer by Heineken has the full support and commitment of the management of ABC, according to a company press release.
Founded in 1897, ABC was wholly privatized in February 1997 and its shares are quoted on the Cairo Stock Exchange and the London Stock Exchange in the form of Global Depository Receipts.
ABC is today the sole Egyptian brewery group, with a beer volume of around 430,000 hectolitres. Its produces the pilsner beer brand Stella is in Egypt. With a volume of 620,000 hectolitres non-alcoholic malt beverages, particularly the flavored-malt drink Fayrouz, ABC is also the market leader in this segment.
In addition to this, ABC has wineries producing the brands Gianaclis and Obelisque that account for 85 percent of the domestic consumption. The market share of the spirits division is around 35 percent while its soft drinks operations have a market share of three percent.
In 2001, ABC derived 52 percent of its sales from beer, 29 percent from non-alcoholic malt beverages, 11 percent from spirits and wine and eight percent from soft drinks. Total net turnover amounted in 2001 to $105 million, operating profit to $30.8 million and net profit to $22.8 million. ABC employs 3,860 people.
On completion, Heineken will finance the transaction from its cash resources. It is expected that this acquisition would immediately be accretive to Heineken's net profit. Moreover, this transaction would represent a further step for Heineken in realizing an optimal balance between its activities in stable, mature markets and those in developing markets. — (menareport.com)
© 2002 Mena Report (www.menareport.com)
