Selling Well When Things Are Low

Jun 1, 2002

Despite Argentina's dire straits, the country's largest brewer managed to get a pledge from its Brazilian competitor to buy it out at a future date and price.

How do you sell your company in the depths of the worst economic crisis in your country's history and still hope to get a decent price? The owners of Quilmes, Argentina's biggest brewer, seem to have achieved this feat when they agreed to sell out to Brazil's AmBev, one of the world's five largest drinks companies, in an ingenious two-step deal.

In May, AmBev and Quilmes announced a "strategic alliance," that in reality, was the first major acquisition of an Argentine company by a foreign competitor since the country's disastrous default and devaluation six months ago. The Brazilians are unmistakably in the driving seat, but have retained the management at Quilmes.

Although Quilmes is battered, it is not overburdened by debt and has commanding shares of the beer markets in Bolivia, Paraguay and Uruguay that have allowed it to survive the disaster in Argentina in reasonably...

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