(Reuters & WHAM News) - Cerveceria Costa Rica struck a deal to buy privately held North American Breweries, which sells Genesee and Labatt beer in the United States, for $388 million in cash. North American Breweries owns the locally based Genesee Brewery.
The CEO for North American Breweries, Rich Lozniak, tells WHAM News that this is good news for the local operation. He says Cerveceria plans to continue to grow the company and the local management team will stay in place.
KPS Capital Partners, the private equity firm that owns North American Breweries, said in a statement on Friday that it expected the deal to close in the fourth quarter. KPS earned a return of more than 9 times invested capital on the sale, according to a source familiar with the matter.
Cerveceria Costa Rica is a unit of Florida Ice and Farm Co S.A.
NAB's other brands include Honey Brown Lager, Magic Hat and Pyramid.
Reuters reported last month that the brewer, one of the largest independently owned beer companies in the United States, was up for sale.
KPS formed the company in February 2009 when it bought the Labatt brands in the U.S. for an undisclosed price from Anheuser-Busch InBev
The brewing giant needed to sell the business in order to receive Justice Department clearance for InBev's $52 billion takeover of U.S. rival Anheuser-Busch. AB InBev still sells Labatt beer outside of the U.S.
North American Breweries bought the privately held brewer of Genesee and Dundee brands in February 2009. It acquired Independent Brewers United Inc, which owned Magic Hat and Pyramid, in 2010.
The global brewing industry has been rife with deals as the industry leaders, such as AB InBev, SABMiller PLC and Heineken seek to boost their exposure in emerging markets and take on smaller brands.
Craft, or small batch, beers, such as Magic Hat, have also been a bright spot in a U.S. beer market that has been in decline for three years as many drinkers have switched to wine or cocktails.