CEE – CVC acquires AB InBev CEE operations for USD 2.23bn

The deal also included an earn-out structure, which could bring an additional payment for AB InBev of USD 800m depending on CVC's returns. AB InBev also has a right of first offer if CVC decides to sell the business in the future.

A senior debt facility of approximately USD 1bn was provided by international and regional banks to support the deal. The deal value was comprised of USD 1.6m in cash (debt and equity); USD 448m in an unsecured deferred payment obligation with a six-year maturity, which can be automatically extended by up to two years in the event of restructuring of the senior debt financing, bearing interest at 8-15%; and USD 165m in minority interests, assuming market value at close on October 14, 2009.

The acquisition includes AB InBev's operations in Bosnia-Herzegovina, Bulgaria, Croatia, Czech Republic, Hungary, Montenegro, Romania, Serbia and Slovakia. A licensing agreement with AB InBev will enable CVC to brew and distribute brands such as Stella Artois, Beck's, Löwenbräu, Hoegaarden, Spaten and Leffe in these countries.

Just last week, AB InBev sold Busch Entertainment C (BEC) to Blackstone Capital for up to USD 2.7bn (including a USD 2.3bn cash payment a right to participate in Blackstone's return on its initial investment capped at USD 400m).

Barclays Capital and Lazard acted as financial advisers to AB InBev, and Clifford Chance acted as legal adviser, while Freshfields acted as legal counsel to CVC.

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