Food & Beverages

Interbrew fails to disappoint

25 Jun 2003

The brewer avoided the sales hiccup that hit Heineken. But there are doubts that Interbrew may have sacrificed margins to support growth. Its traditional discount to Heineken has virtually vanished. That may not be justified even if Heineken itself isn't a buy.

Heineken warns on profits

23 Jun 2003

Either investors have underreacted or the rest of the industry is about to follow Heineken with a warning. Even with the earnings shortfall and decline in value, the group commands a richer multiple of earnings than all its European peers.

SAB suffers Miller hangover

22 May 2003

The $5.6bn takeover of Miller was already a stretch. As the US brewer's profits deteriorate, the economics worsen. Given this, it is somewhat galling to see SABMiller plunking down such a big price for Italy's Peroni.

Heineken reaches deeper into BBAG

15 May 2003

The Dutch brewer was stung by the reaction of investors to its E1.9bn takeover of Austria's BBAG. Now it's hinting at a doubling of expected synergies. But even with these, the deal doesn't look like a home run.

SABMiller joins ranks of overpayers

14 May 2003

What is it about brewers that compels them to bid up and overpay for assets, as SAB has done with Italy's Peroni? To make this deal work for shareholders, SAB will have to find a way of selling Peroni's beer through its global distribution channels.

Bacardi could kick off drinks M&A

5 May 2003

An IPO by the rummaker's heirs may not happen for years, but any incremental step now could jumpstart the industry jockeying. Among Big Booze, Bacardi, Brown and Pernod are sheltered. But Allied Domecq is very eligible and on a lowlier multiple.

Heineken overpays for BBAG

2 May 2003

The return on the E1.9bn it is paying for the Austrian brewer will be only 5% even after four years. Unless the Dutch brewer has some cost cuts up its sleeve, this is a bad deal for shareholders.

S&N seeks £2.3bn from pubs sale

28 Apr 2003

The UK brewer's clean break from retail should give it greater flexibility to boost its beer business. But it should wait for the right opportunities before striking, not just those that happen to be available.

Scottish & Newcastle finally nabs a CEO

10 Apr 2003

It's taken long enough reflecting the difficult task Tony Froggatt faces squaring S&N's debt with its generous dividend payout. If he can't solve this problem, it is hard to see how S&N can participate in the ongoing consolidation of the industry.

Interbrew neo-CEO has work cut out

19 Mar 2003

Disentangling the mistakes of his predecessors won't be easy, as fullyear results highlight. Especially when alluring assets like Italy's Peroni continue to beckon the Belgian brewer to overpay.

Parmalat pulls bond offering amid jitters

27 Feb 2003

Fears about the company's solidity made investors demand steep conditions on the E300mE500m deal. The company insists that it has the money to refinance itself.

Parmalat may get shot of football team

21 Feb 2003

Parma Calcio never made much sense in a dairy group. But the mooted process looks anything but straightforward. Moreover, Parmalat investors have plenty more to worry about.

Cadbury disappoints on US beverages

12 Feb 2003

Disruption in its North American bottling system is to blame. This may explain why the group isn't planning to exit DPSU Bottling anytime soon, even though Carlyle is agitating for an exit.

Scottish & Newcastle warns on profits

3 Feb 2003

What does Britain's biggest brewer want to be: a growth stock or the beverage industry's version of a utility? Its 80% dividend payout does not square with its pretensions for growth. Something has to give.

Australian wine tempts takeover

17 Jan 2003

As Constellation's $1.43bn purchase of BRL Hardy shows, the highgrowth of New World wine exports is attractive to spirits groups. But they don't come cheaply. Constellation will struggle to make the returns on this deal exceed its higher cost of capital.

Cautious Heineken slips in global beer slugfest

15 Jan 2003

If being bold does not suit the Dutch brewer, it should at least hand back more money to shareholders. In a consolidating market, the brewer's piecemeal M&A approach risks turning it into an international alsoran.

Cadbury agrees $4.2bn Adams takeover

17 Dec 2002

At about 14 times ebitda, the price is generous, but not out of line with previous deals in the confectionery industry. If Cadbury can make good on promises of $185m of synergies by 2006, the deal will cover its cost of capital by then. But it's a tall order.

Cadbury agrees $4.2bn Adams takeover

17 Dec 2002

Cadbury clinches $4.2bn Adams deal

16 Dec 2002

By funding Adams with its balance sheet, Cadbury s net debt to enterprise value nearly doubles to about 40%. Barring any lastminute hitches, Cadbury shareholders will wake up owning a bigger business, but one with higher risk.

Cadbury clinches $4.2bn Adams deal

16 Dec 2002