Anheuser-Busch InBev (BUD.US) Spends $3 Billion to Repurchase Stake in US Metal Can Plants

Anheuser-Busch InBev SA (BUD.US) has announced it will repurchase a 49.9% stake in its US metal can plants for approximately $3 billion from a consortium of institutional investors led and advised by Apollo Global Management (APO.US).

The metal can operations encompass seven production facilities spread across six US states and represent a critical strategic component of the company's US supply chain system.

The brewer, which owns brands such as Stella Artois and Budweiser, will use its own cash reserves to complete this acquisition.

This global beer giant originally sold this stake to Apollo for $3 billion in 2020, a move aimed at repaying the massive debt accumulated from its 2016 acquisition of rival SABMiller.

Currently, beer makers are facing challenges across various markets as consumers curb spending and tariff policies take effect.

Last year, former US President Donald Trump imposed significant tariffs on steel and aluminum, stating the action was intended to secure the future of the US steel industry.

Anheuser-Busch InBev emphasized on Tuesday that by regaining full control of its plants, the company will be able to ensure the "quality, cost-effectiveness, speed of innovation, and supply stability for its branded products, while creating industry-leading manufacturing jobs in communities across the US and boosting local economic growth."

Senior industry analyst Duncan Fox noted, "Anheuser-Busch InBev's move is likely an effort to consolidate the quality of its key US packaging assets in response to aluminum tariffs."

Bernstein analyst Trevor Stirling suggested the transaction more closely resembles a form of "debt repurchase" operation.

He added that it also "demonstrates the company's confidence in its underlying cash flow and deleveraging capabilities."

It is understood that, despite facing severe challenges and missing beer volume expectations in the third quarter of last year, Anheuser-Busch InBev still initiated a $6 billion share buyback program.

The transaction for the metal can plant stake is expected to be completed in the first quarter of this year.