Quenching Corporate Thirst

Dec 1, 2002

A 123-year-old Peruvian brewer has become the prize in a fight to dominate the region's beer market. The battle involves some of South America's most powerful families.

Early in July, when the air was thick with rumors that Bavaria, Colombia's largest beer company, was about to buy a major stake in Peru's dominant brewer, Backus&Johnston, Steven Bandel, president of Venezuela's Cisneros Group, decided it was time to make a move. Backus is one of the few independent brewers left in the rapidly consolidating South American beer market and its monopoly status in its home market makes it extremely profitable and an attractive takeover target. In 1999, Cisneros had lost to Backus in a bid for a smaller Peruvian competitor, and since early 2002 the Venezuelan group had been eyeing Backus itself. Cisneros's archenemy, Empresas Polar de Venezuela, already had a minority share in Backus. Bavaria's pending purchase meant that two of Cisneros's biggest competitors in Latin America would take control of Backus and secure a stronghold from which to dominate the Andean region. ...

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