LONDON (Reuters) - Two of the world’s biggest brewers, Anheuser Busch InBev (ABI.BR) and Heineken (HEIN.AS), are in a $1.5 billion race to buy the Dominican Republic’s biggest brewer Cerveceria Nacional Dominicana (CND), said people familiar with the matter.
The brewer of Presidente beer which is available in many other Caribbean islands and also the United States has been put up for sale by the nation’s biggest company Grupo Leon Jimenes, which controls the majority of the brewing company.
“The business has a dominant position in the beer market and so is an attractive asset for buyers. The race is between AB InBev and Heineken with a result expected in the next few weeks,” said one person familiar with the situation.
Another source with knowledge of the sale said on Tuesday the auction process was “quite far down the road”.
Both Heineken and AB InBev declined to comment, while brewer CND could not be reached for comment.
Amsterdam-based Heineken already owns a 9.3 percent stake of CND, and in neighboring Haiti increased its stake in Haitian brewer Brasserie Nationale d’Haiti (Brana) to 95 percent from 22.5 percent in December 2011.
Heineken, the world’s third biggest brewer after AB InBev and SABMiller SAB.L, has been expanding in the American region buying Mexico’s second biggest brewer FEMSA Cerveza in 2010 which also gave it a foothold in the Brazilian market.
The world’s biggest brewer AB InBev has extensive operations in North and South America and controls nearly 50 percent of the United States beer market and almost 70 percent of the Brazilian beer market.
The Belgium-based brewer of Budweiser, Stella Artois and Beck’s has cut its debts sharply since its $52 billion acquisition of Anheuser Busch in late 2008 and analysts say it is now in a position to start making acquisitions.
U.S. industrialist Charles Wanzer with other business partners founded brewer CND in 1929 and started brewing the iconic Dominican beer Presidente in 1935, and then the brewer was acquired in 1986 by cigarette company Grupo Leon Jimenes.
The group currently has over a 90 percent share of the domestic beer market in the Dominican Republic, which has a population of around 10 million, and has been expanding beer exports to the U.S. and Europe in recent years. It employs about 2,500 people and produces up to 500 million litres of beer.
Editing by Mike Nesbit