Belgian brewing giant Interbrew – owner of the Hoegaarden, Bass and Stella Artois beer brands – has agreed to buy German rival Brauerei Beck & Co. for DM3.5 billion ($1.58bn).

The acquisition – subject to approval by regulators and Beck’s shareholders – hands Interbrew access to the German market. Moreover, Beck’s is one of Germany’s biggest beer exporters, sending around 60% of its eponymous premium brand abroad, mostly to America, the UK and Italy.

“Beck’s provides an excellent fit with our strategy of acquiring and developing strong brands in local markets,” said Interbrew chief executive Hugo Powell.

However, the acquisition did not come cheap. At thirteen times Beck’s historical EBITDA (earnings before interest, taxes, depreciation and amortization), the price was well ahead of analysts’ expectations, making the purchase one of the brewing industry’s most expensive deals ever.

News source: Financial Times