Denmark: Royal Unibrew buys 52% stake in St Vincent Brewery for $9.3 mil

Danish brewery Royal Unibrew AS said it has agreed to acquire 52 pct of the share capital in Caribbean brewer St Vincent Brewery Ltd for 9.3 mil USD, AFX News Limited reported July 2.

Following the acquisition, the Danish brewery controls 76 pct of the shares in St Vincent Brewery.

Royal Unibrew said it expects its total 2007 sales to be at the same level as in 2006, while earnings are seen to be lower due to integration costs following the acquisition and the introduction of VAT in the first half of 2007.

Within 2008/09, the group expects to meet its target of ROIC and EBIT margins of at least 10 pct and a free cash flow of at least 7 pct of net sales.

The acquisition is an integrated part of Royal Unibrew's strategy platform 'MACH II', according to which the Caribbean and African malt drink markets constitute focus areas.

'The acquisition of St Vincent Brewery will win Royal Unibrew the leading position in the market thus strengthening the Group's overall position in the region,' the brewery said.

'The access to new, strong local brands and attractive product portfolios provides an opportunity of increased profitability through the expected synergies within purchases, sales, marketing, distribution and organisation,' it further said, adding it expects synergies between St Vincent brewery and previously acquired brewery activities in Antigua and Dominica.

In 2006, St Vincent Brewery recorded net sales of 15 mln usd and a pretax profit of 1.9 mln usd, Royal Unibrew said, adding it produces the Danish brewer's Vitamalt brand on license.