business

Japanese beermaker Asahi looks to halve debt after buying Australia assets

4 Comments
By Yuki Nitta and Rocky Swift

Japan's Asahi Group Holdings said it will aim to halve its debt and forego overseas investments after spending $11 billion to buy the Australian operations of Anheuser-Busch InBev.

"Basically, we are not considering any large-scale acquisitions," said Atsushi Katsuki, who became Asahi's new chief executive in March.

The owner of brands including Asahi Super Dry, Peroni and Pilsner Urquell will aim to reduce its debt to EBITDA (earnings before interest, taxes, depreciation and amortization) to three times from six at the end of December.

Asahi won regulatory approval last year to buy the Australian brands Carlton & United Breweries (CUB) after agreeing to sell other assets in the country. Katsuki previously led Asahi's operations in Australia and Oceania before becoming its chief financial officer in 2019.In mature markets like Japan and Europe, Katsuki told Reuters he wanted to "premiumize" products: selling drinks at higher prices as shrinking populations mean that high volume sales may no longer be possible.

In Japan, Asahi has been hit harder than rivals by the COVID-19 pandemic due to its dependence on keg sales to restaurants and bars - many of which have struggled amid the prolonged crisis. Even so, the company in February forecast its full-year operating profit will exceed levels seen in 2019.

© Thomson Reuters 2021.

©2021 GPlusMedia Inc.

4 Comments
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Asahi has been hit harder than rivals by the COVID-19 pandemic due to its dependence on keg sales to restaurants and bars

It's a virtual beer monopoly system in Japan, and those like Asahi who push it deserve to suffer big financial losses.

My local yakitori, for instance, used to have Suntory Malts and Premium Malts. And then one day, that had disappeared and replaced entirely by Asahi Super Dry, my least favourite brew, whose salesmen had ensured that newly printed menus and PR goods were plastered all over the place. We no longer go there.

The system deprives beer drinkers choice and quality,. like craft beers. For monopolies in an economic crisis, it's a case of the bigger they are, the harder they fall.

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Its illegal to use Homebrew kits in Japan.

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Sadly all Japanese beers independent or otherwise seem to be lacking in something.... not sure what (Perhaps I lost my taste buds years ago in advance of COVID), or seriously everything here is just bland.

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It's a virtual beer monopoly system in Japan, and those like Asahi who push it deserve to suffer big financial losses.

The sad thing is that neither of those Keiretsus won't ever go bankrupt because the Japanese government will resurrect them at all costs even if those companies live as zombies.

Even China has been more skeptical towards the concept of "too big to fail" in recent years. They permit failed Chinese firms to collapse in numbers without any merger.

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