CANADA – Royal Unibrew, the second largest beer company in Denmark, is eying to buttress its North America production capabilities with the acquisition of a Canadian craft brewing company Amsterdam Brewery Co. Ltd for US$34million.
The acquisition is expected to be earnings per share (EPS) accretive within the first year of ownership, while the closing is expected to take place during Q3 of 2022.
Royal Unibrew said Amsterdam Brewery Co. has grown to become a large-scale craft brewery with the potential to increase both capabilities and capacities during the coming years.
CEO of Royal Unibrew, Lars Jensen noted that the acquisition is very important for the future growth of Royal Unibrew in the Americas region.
He added that it will help in adding capacity in Canada, which is also close to the company’s US business, and over time it is expected to serve most of Canada and partly the US.
From the acquisition of Amsterdam Brewery Co. Ltd., the beer giant aims to reduce transportation costs and CO2 footprint, which are making exporting from Europe less attractive.
Amsterdam Brewery Co. Ltd. will also add a more premium offering to Royal Unibrew’s current mainstream portfolio in Canada and in particular in Ontario which is the largest region for its business in Canada.
Further, the Canadian craft brewer has a solid position in On-Trade in Toronto through two own operated Brewpub restaurants.
Through traditional On-Trade outlets, the Denmark brewery believes it will bring further synergies during the coming years.
Royal Unibrew also hinted that while its export business in the Americas has grown over recent years, it is currently challenged by high freight costs and longer and more unpredictable logistical supply chains.
The company hopes the acquisition to enable maneuver through this export model that has natural limitations by increasing local production capacity and helping it become more flexible.
The acquisition succeeds the agreement to acquire the remaining 75% of Hansa Borg Bryggerier, of which Royal Unibrew already had 25% ownership, resulting in a 100% ownership of the company.
Hansa Borg Bryggerier is Norway’s second largest brewery and beverage company with four breweries and one bottling plant throughout the country and products ranging from beers to ciders, soft drinks, waters, and wines for the Norwegian market.
Together with Solera Beverage Group, which Royal Unibrew acquired in 2021, the acquisition of the remaining 75% of Hansa Borg Bryggerier was expected to create a strong multi-beverage market position for Royal Unibrew in Norway.
Liked this article? Subscribe to Food Business Africa News, our regular email newsletters with the latest news insights from Africa and the World’s food and agro industry. SUBSCRIBE HERE.