Suntory buying spirits maker Beam in a $16 billion deal - WDRB 41 Louisville News

Suntory buying spirits maker Beam in a $16 billion deal

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DEERFIELD, Ill. (AP) -- Beam, the maker of Jim Beam and Marker's Mark alcohol brands, has agreed to be acquired by Japan's Suntory Holdings Ltd. for approximately $13.62 billion.

Shares of the spirits maker rose in Monday pre market trading.

Suntory will pay $83.50 per share, a 25 percent premium to Beam's Friday closing price of $66.97. The companies put the deal's value at about $16 billion, including debt.

Suntory has a portfolio of spirits, with whiskies including Yamazaki and Hakushu as well as Midori liqueur and other beverages.

Suntory already distributes Beam's products in Japan. Beam distributes Suntory's products in Singapore and other Asian markets.

Both companies' boards unanimously approved the transaction, which is targeted to close in the second quarter.

It needs approval from Beam Inc. stockholders.

Beam's President and CEO Matt Shattock issued this statement, "This is a very exciting development that delivers substantial value for our stockholders and creates an even stronger global company with an excellent platform for future growth."

Bourbon historian Michael Veach sees the purchase as mostly a positive development.

"I've heard rumors for years that Jim Beam is up for sale," says Veach.

He points out that several years ago an Italian company purchased the Wild Turkey distillery near Lawrenceburg, Kentucky and has invested millions of dollars to upgrade its facilities, including expansion of the distillery operation and a new bottling line.

And more than a decade ago another Japanese company purchased the Four Roses Distillery in Central Kentucky.

"When the Japanese purchased Four Roses, they pumped a lot of money into the company and did a lot of work, bringing the Four Roses brand back to the United States where it has been quite successful," explains Veach.

Louisville's mayor also reacted to the news of the impending sale.

"They've indicated there will be no threat to local jobs," says Mayor Greg Fischer, "as a matter of fact Beam is growing quite a bit especially in the bourbon segment."

It was in July that Beam opened a human resources office on the second floor of Fourth Street Live at Fourth and Liberty.

Beam also has a bottling operation and a visitors center in Bullitt County.

Makers Mark operates out of an historic site in Marion County.

Veach worries more about the impact high taxes are having on Kentucky's bourbon industry than purchases by foreign based companies.

He says taxes are higher in Kentucky than in any other state.

He adds, "If Kentucky government doesn't do something about the tax situation, I wouldn't be surprised to see some of the bourbon distillers move to another state."

Veach says Kentucky lawmakers need to make changes to the tax code before its too late.

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