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Success stories

01/10/2012

Acquisition of the remaining 54% interest in APB - Heineken

On September 18, 2012 Heineken (BBB+ / Baa1) announced that it had reached an agreement with the major shareholders in Asia Pacific Breweries ("APB"), clearing the way for it to complete a full takeover of APB. The transaction has been a result of a closely contested battle between Heineken and ThaiBev.

The total cash consideration is US$5.6 billion, financed through existing cash resources and a new EUR 2.5 billion bridge to bonds facility.
Heineken is the 3rd largest beer company in the world in terms of market share (10.8%), with a leading portfolio of brands including Heineken, Amstel, Strongbow, Desperados and Dos to name a few.

It has demonstrated an impressive track record of integrating large scale acquisitions and its ability to deleverage quickly. Its other sizeable acquisitions have included Femsa for EUR 5.3 billion (2010) and Scottish & Newcastle for £3.85 billion (2008).

APB is a leading brewer in the Asia Pacific region with brands such as Tiger, Bintang and Anchor.

The acquisition price represents an EV/EBITDA 2011 multiple of 19x, reflecting the scarcity of attractive targets in the fast growing Asia Pacific region.
SG CIB acted as MLA in the EUR 2.5bn acquisition financing, which is structured as a club deal with a group of 6 banks (however, the facility has been pre-funded through the debt capital markets and hence cancelled before any drawing).
The transaction, which is subject to regulatory approvals, is expected to close at the end of 2012.

Subsequently, on October 2, 2012 Heineken launched a USD-denominated benchmark bond and issued $3.25bn in four tranches with maturities ranging from 3-year to 30-years. SG CIB acted as a Bookrunner in the bond issuance. It is interesting to note that they achieved the lowest ever coupons in 3 and 5 years category for a "BBB" rated borrower at 0.80% and 1.40% respectively.
This transaction is another landmark financing for SG, after having financed ABI's acquisition of Grupo Modelo during the summer of 2012, reinforcing our position as a leading bank in this industry. It is also one of the few transactions in Europe, whereby the acquisition facility has been fully taken out in the capital markets before signing, a great example of the originate to distribute model.