North American Breweries possibly for sale
By rule of thumb, private equity companies like to seek an exit after three to four years. That’s why it should not come as a surprise that North American Breweries, which sells Genesee and Labatt beer in the U.S., is rumoured to have been put up for sale by its owner, private equity firm KPS Capital Partners, media reported on 6 September 2012. Representatives from KPS were quick to refute the allegation.
The beer company was bundled together in 2009 and produced over 3.2 million hl beer in 2011 at its four breweries, says Beer Insights, a trade publication. According to insider estimates, it had sales of over USD 50 million and could be worth around USD 400 million.
In February 2009 KPS bought the Labatt brands in the U.S. for an undisclosed sum from Anheuser-Busch InBev, which owns the Canadian brewer Labatt.
AB-InBev had been forced to sell the business in order to receive Justice Department clearance for InBev’s USD 52 billion takeover of U.S. rival Anheuser-Busch. AB-InBev still sells Labatt beer in Canada and elsewhere.
Ironically, North American Breweries has an agreement with Molson Coors which runs until 2016, whereby Molson Coors brews, packages and ships Labatt trademark brands to the United States. Beer Business Daily commented in 2010, when the agreement was signed, that John Labatt is probably spinning in his grave with the notion of his namesake beer being brewed in a Molson brewery.
In 2009, New York-based KPS also bought the High Falls Brewing Company, the maker of the Genesee and Dundee beer brands, and formed a new company, North American Breweries, to serve as a platform for its investments in the beer and malt-beverage sectors.
It next acquired the licences for the Seagram’s Cooler Escapes and Seagram’s Smooth malt-beverage brands from the U.S. arm of French spirits group Pernod Ricard. In 2010, it purchased Independent Brewers United, which owned the craft brewers Magic Hat and Pyramid.
