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KFN......UPDATE 1-KKR near deal to buy Oriental Brewery for $1.8 bln
Sun May 3, 2009 4:41pm EDT Email | Print | Share| Reprints | Single Page[-] Text [ ]
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InBev picks KKR as $1.9 billion buyer of S.Korea brewer
Monday, 27 Apr 2009 11:38am EDT HONG KONG/NEW YORK, May 3 (Reuters) - Kohlberg Kravis Roberts & Co is finalizing an agreement to buy Anheuser-Busch InBev NV's (INTB.BR) South Korean brewer Oriental Brewery Co, sources familiar with the situation said on Sunday.

The deal is expected to be worth about $1.8 billion, one source said. Another source familiar with the situation said it was expected to be announced this week.

A Wall Street Journal report, citing unidentified people familiar with the matter, said about 45 percent of the purchase price would come from KKR, with much of the rest coming from leveraged loans and seller financing.

The Journal said AB InBev would provide $300 million worth of financing for the deal, citing one unnamed source.

Nomura Holdings Inc, HSBC Holdings PLC, JP Morgan Chase & Co and Standard Chartered PLC would underwrite four-fifths of the leveraged loans needed for the deal, according to the online Journal story, which cited another unnamed source.

Anheuser-Busch and KKR declined to comment and representatives for the banks were not immediately available for comment.

KKR told Reuters last week it was in exclusive negotiations with InBev. [ID:nLS212745].

It became the preferred bidder after competing against other private equity bidders MBK Partners LP and Affinity Equity Partners to buy South Korea's No. 2 brewer.

Anheuser-Busch InBev, the world's largest brewer, is looking to sell off non-core assets and repay debt.

KKR's involvement was seen as a positive for Oriental Brewery's bigger rival, Hite Brewery (103150.KS), as it would not hurt its competitive position, unlike other potential suitors.

One of these is South Korean retail giant Lotte Group, which was widely considered the front-runner to buy the Korean brewer, but it said recently it had not handed in a final offer. [ID:nSEO321905]

With Goldman Sachs (GS.N) as adviser, KKR has JPMorgan, Standard Chartered (STAN.L) and HSBC (HSBA.L) among its backers, as well as Calyon, ING Bank, Natixis and Nomura (8604.T), Reuters Basis Point reported earlier.

JPMorgan (JPM.N) and Deutsche Bank (DBKGn.DE) are running the sale. (Reporting by George Chen in Hong Kong, Jessica Hall in Philadelphia, Sinead Carew and Megan Davies in New York; Editing by Richard Chang)
http://www.reuters.com/article/euMergersNews/idUSN0332721820090503