“While as a board we believe the company is well positioned and confident of continued growth under its current structure, this presents a low risk opportunity for the products and brands to be firmly established nationally and consider new markets internationally through the Lion network,” LWB chairman Ian Cochrane said in a statement.
Cochrane added that if the takeover completes, Little World Beverages will have delivered a shareholder return of 543% since its initial public offering in November 2005 compared to a 19% gain from the benchmark S&P/ASX200 index.
Gresham Advisory Partners and Freehills are advising Little World Beverages while Greenhill Caliburn and King & Wood Mallesons are advising Lion.
The deal follows a string of acquisitions by Japan’s Asahi Down Under. In 2011, Asahi bought New Zealand’s Independent Liquor for $1.27 billion and spent $309 million on a key portion of P&N Beverages Australia and New Zealand’s Charlie’s Group.
According to Dealogic, it is the fourth-largest Japanese investment into Australia this year behind Mitsui and Mitsubishi’s $2 billion stake purchase in Woodside Petroleum’s Browse LNG project, Sumitomo’s $448 million stake purchase in Aquila Resources’ Isaac Plains Coal Mine and NEC’s $256 million takeover of technology solutions player CSG.
From the June 18, 2012, Prepared Foods Daily News