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Bigger BHL

Brazilian company has big plans for Brewery

The Brazilian brewing company attempting to take control of Banks Holdings Limited (BHL) has remained quiet on its chances of acquiring majority shares, even while making expansion plans.

Ambev, the biggest brewery in Latin America and the fifth largest in the world, needs an additional ten per cent of the shares of BHL to gain control of the local brewery but will not say if it was confident of achieving its goal.

However, vice president for Central America and the Caribbean operations Edwardo Lacerda told Barbados TODAY the idea was to have the company reach its full potential while earning Barbados more foreign exchange through increased production and exports.

And while Lacerda could not say how much his company would invest to carry out its expansion plans, he said Ambev saw an opportunity and simply jumped at it.

“What we know is that this is a plant that can be expanded and increase its current capacity and we are going to invest in accordance to this and the demand that will be in the market,” he said.

“We bought 40.7 per cent of BHL and now we launched a tender offer that is valid until the end of this month, to buy the remaining shares in accordance to the local legislation. So we are very interested in the Barbados market. Banks is a great brand, and we would like to enter in that market through a great brand, the undisputed local leader,” said Lacerda, adding that they were seeking to get “as much” shares as they could.

Since acquiring the over 40 per cent shares last month, officials of Ambev have offered a share price of $4 to the existing shareholders.

And last week BHL advised shareholders against making any decision on the sale of their shares until they receive a “BHL Directors’ Circular”.

BHL officials indicated that the board of directors of the BHL Group had engaged the services of an independent professional advisor to undertake a valuation of the company’s shares, and to issue a “fairness opinion”.

Speaking to Barbados TODAY at the Hilton resort this afternoon, Larcerda said he understood that the BHL meeting and circular should be done within a period at which Ambev’s tender would still be valid, and added that he was willing to wait.

He urged Barbadians to see the move as one that could only be good “for the population and for the employees in the country itself.”

“The country will benefit from additional exports that we want to make. The employees will have not only possibility to grow in their careers within Barbados but also they will be part of an international company and therefore be able to grow their careers internationally. And the population will have a company investing in the local market and the local brand and try to make it as good as possible. And as a possibility of bringing new brands to the market that are part of our international portfolio. So I see this as a win-win opportunity for everyone,” explained Lacerda.

He said “a couple” of shareholders have indicated their interest in selling their shares. However, he would not say how many shares they held or were willing to sell.

He explained that the intention of Ambev officials was to “grow and develop the local market” as much as possible and to use Barbados as a hub for exports for the Caribbean region. He noted the company’s “pretty new and very good” plant which has the capacity for expansion, including the introduction of new products.

“By expanding I mean the local market – to sell more volume, to grow the beer category and also exports. So it is to produce beers that will be consumed in other countries specially Caribbean and CARICOM region.

“So the first priority for us is to invest and grow the Banks brand in the Barbados market. And we also want to export our brand from Dominican Republic from here, which is called Presidente. It is the number one beer in the Caribbean today and this is one of our intention as well, to use the plant here as a hub to export,” he added.

Larcerda said now was a good time to invest in Banks Holding as part of a strategy to grow Ambev’s in the Caribbean and Central America.

“And we saw an opportunity to enter the Barbados market now and therefore we want to use this opportunity to expand our operations and keep on growing in the region. We are brewers. This is our business and we want to continue in this business and continue growing.”

Ambev, which employs over 37,000 people in Brazil alone, currently boasts some of the best-known brands of beers in Latin America including Skol, Brahma and Quilmes, as well as Labatt and Budweiser in Canada.

Besides Peru, Ecuador, Paraguay, Cuba, Bolivia, El Salvador, Chile and the Dominican Republic, the company also has operations in Antigua and Barbuda, Dominica and St Vincent and the Grenadines.

The Ambev executive said there would be no name change to the BHL operations should it succeed in its takeover bid.

“This is a shareholder transaction and our intention is to keep the Banks name and keep the company as it is today and of course grow and exploit its full potential,” he stressed.

Lacerda said he had not yet met with BHL officials, but said he was scheduled to meet with some shareholders during his short visit to Barbados, during which he also intends to carry out some market research.

4 Responses to Bigger BHL

  1. seagul October 6, 2015 at 2:20 am

    Barbados is for sale–wake up, smell the Brazilian coffee…

  2. carson c cadogan October 6, 2015 at 7:57 am

    This is amazing. Under “normal” trading on the stock exchange these company shares trade very low. From the time a take over is mentioned, up jump the share prices.

    What is going on?

    How many more companies on our stock exchange are like this? And what is this saying?

    • Kevin October 6, 2015 at 6:56 pm

      That’s normal. The company who’s shares are being bought see a rise in prices. And the company who is buying the shares normally see a short-tern fall in their own share price.

  3. lswiltshire October 6, 2015 at 12:44 pm

    This is what the DLP has done to Barbados….lol
    Soon some outside interest will take over the two bridges in Bridgtown as well as Spooner’s hill


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