LUXEMBOURG–(HISPANIC PR WIRE – BUSINESS WIRE)–Jan. 14, 2003–Quilmes Industrial (Quinsa) Societe Anonyme (NYSE: LQU) (“Quinsa”) and Heineken International B.V. (“Heineken”) announced today that they have entered into an agreement to settle the arbitration proceeding pursuant to which Heineken sought to prohibit completion of Quinsa’s pending business combination with Companhia de Bebidas das Americas -AmBev.
Pursuant to the agreement, Heineken and Quinsa agreed to terminate immediately the arbitration proceeding and released all claims against each other arising in connection with the AmBev transaction. Heineken also released all claims against Quinsa’s controlling shareholder Beverage Associates (BAC) Corp. arising in connection with the AmBev transaction.
Pursuant to the settlement agreement BAC agreed to purchase Heineken’s 15% equity interest in Quilmes International (Bermuda) Ltd. (“QIB”), for an aggregate price of US$ 102.7 million. QIB is a subsidiary of Quinsa that in turn owns all of the group’s operating companies in Argentina, Bolivia, Chile, Paraguay and Uruguay. BAC’s purchase of the QIB shares is conditioned on, and expected to occur simultaneously with, the completion of the AmBev transaction.
As a result of the settlement agreement, the shareholders agreement between Quinsa and Heineken relating to Heineken’s investment in QIB was terminated. The trademark license agreements under which certain of Quinsa’s subsidiaries currently produce, market and distribute the Heineken brand will remain in effect. However, the settlement agreement gives Heineken the right to terminate these agreements with 60 days prior notice if the termination occurs before December 31, 2003 and with 120 days prior notice if the termination occurs thereafter.
In the unlikely event that the AmBev transaction is not completed, Heineken will have a right to convert, at any time within 6 months of the termination of the AmBev transaction, its QIB shares into the number of Quinsa shares that will give Heineken the same proportionate economic interest in Quinsa as it has in QIB as of the time of the conversion.
BAC has assigned to AmBev and AmBev has agreed to acquire, approximately 57% of the QIB shares that BAC agreed to purchase from Heineken.
The settlement agreement further provides that Quinsa will have the right to purchase the QIB shares held by BAC and AmBev, for cash, at the fair market value of those shares to be determined by an independent investment bank. The Quinsa board will have the right to determine whether and, if so, when to exercise this right.
AmBev consented to Quinsa’s execution of the Heineken settlement agreement.
As Quinsa announced yesterday, the Argentine antitrust commission has approved the pending transaction between Quinsa and AmBev, subject to certain specified conditions. This approval satisfies the regulatory approval requirement set forth in the transaction documents between Quinsa and AmBev. Quinsa stated that it continues to believe that the transaction with AmBev will strengthen the financial position of both companies and allow them to compete more effectively in the region.
Agustin Garcia Mansilla, CEO of Quinsa, said, “The settlement with Heineken and the Argentine antitrust approval removed the two existing obstacles to completion of our deal with AmBev, and there now only remain the customary conditions to closing. These developments will allow Quinsa to accelerate the timetable for closing the AmBev deal and for realizing the synergies and other benefits that the deal is expected to generate.”
Quinsa is a Luxembourg-based holding company, which controls 85 percent of Quilmes International (Bermuda) Ltd., (“QIB”). The remaining 15 percent of the shares of QIB are owned, since 1984, by Heineken International Beheer B.V. (“Heineken”).
Heineken Technical Services B.V. renders technical assistance to the operating companies. Quinsa, through QIB, controls beverage and malting businesses in five Latin American countries. Its beer brands are market leaders in Argentina, Bolivia, Paraguay and Uruguay and have a strong presence in Chile. Quinsa also owns the two largest PepsiCo bottlers in Argentina. Its Class A and Class B shares are listed on the Luxembourg Stock Exchange (Reuters codes: QUIN.LU and QUINp.LU). Quinsa’s American Depository Shares, each representing two of the Company’s Class B shares, are listed on the New York Stock Exchange (NYSE:LQU).
Quinsa’s web address: http://www.Quinsa.com.
Quilmes Industrial (Quinsa) S.A.
Francis Cressall, +5411-4321-2744
Van Negris & Company, Inc.
Van Negris or Lexi Terrero