E-Malt.com News article: Denmark: Sale of Carlsberg’s historic brewery to help pay down its $7.9 bln debt
Carlsberg A/S Chief Executive Officer Jorgen Rasmussen said a sale of the Copenhagen property where the company began making beer 162 years ago is moving slower than expected because of the global economic decline, Bloomberg reported on August, 7.
Talks with “a number of parties” are “taking slightly longer than we had hoped” as potential buyers are having trouble getting financing, Rasmussen said in a telephone interview. The CEO said he is committed to finding a buyer so Carlsberg can focus on its beer business.
The Nordic region’s largest brewer put the property in the Valby neighborhood up for sale after a downturn in global beer consumption forced it to free up cash to help pay down its $7.9 billion debt. The site, which has planning approval for 3,000 apartments and office space for 10,000 workers, may net Carlsberg 2.75 billion kroner ($530 million) to 3 billion kroner, according to four analysts surveyed by Bloomberg.
“It will help us to reduce debt, but that strategy will not change whether we sell Valby or not,” Rasmussen said. “At some point we may look to invest in acquisitions but that is not the priority right now.”
Any sale of the 330,000 square-meter property would exclude Carlsberg’s headquarters, museum and micro-brewery, which will remain on the site, the company said. While Carlsberg would prefer to deal with one developer who could take over the entire project, “we would look at any option,” including a group of bidders, Rasmussen said.
Diageo Plc, the world’s largest distiller, last year said it will self half of the land at its St. James Gate Guinness brewery in central Dublin where production started 250 years ago. The move coincided with plans to build a more efficient brewery on the city’s outskirts.
Carlsberg stopped mass-production at Valby, where the company’s first beers were brewed in 1847 under founder J.C. Jacobsen, in 2008 to consolidate operations at a more modern facility in Fredericia, about 200 kilometers (125 miles) west of the capital.
The company’s net debt was 40.8 billion kroner as of June 30, down from 44.2 billion kroner at the end of last year.
07 August, 2009