By Megumi Fujikawa
TOKYO-- Asahi Group Holdings Ltd. has agreed to buy five Eastern European beer brands from Anheuser-Busch InBev NV for EUR7.3 billion ($7.8 billion), the latest big overseas deal by a Japanese food-and-drink industry that is struggling at home.
AB InBev had put the assets on the block as part of its successful plan to win regulatory approval for its merger with SABMiller, a deal that was completed in October.
The five brands, including Pilsener Urquell, will give more international heft to Japan's Asahi, which is one of the top beer makers in its home market but only a small player globally.
The deal left some investors with a bad taste because of the unexpectedly high price tag. Asahi earlier said it had budgeted about $3 billion to $4 billion for overseas acquisitions, but it was forced to spend double that amount to defeat bidders including private-equity firm Bain Capital.
Asahi shares closed 4.6% lower in Tokyo after the Nikkei newspaper reported the price tag an hour before the market closed. AB InBev shares were slightly higher in early European trading.
"Asahi is heading in the right direction by expanding overseas, but the price seems too expensive," said Masayuki Kubota, chief strategist at Rakuten Securities. "Investors will be watching whether Asahi can offer a reasonable explanation about the high price."
An Asahi spokesman said the valuation was similar to other recent beverage deals. The company said Pilsner Urquell holds the top spot as far as market share in the Czech Republic, which it said was the world's biggest beer-drinking country on a per-capita basis. The company said the brands would establish Asahi as a "global player that leverages its strengths originating in Japan."
The deal is the second-largest on record in the food and beverage industry by a Japanese company after Suntory Holdings Ltd.'s $16 billion deal for U.S. liquor maker Beam Inc. in 2014.
Asahi previously bought some European beer brands, including Peroni and Grolsch, for EUR2.55 billion from SABMiller, in another divestiture made to get regulatory clearance.
Japanese beer makers have been actively looking overseas for growth because the domestic market is shrinking, owing to a population that is both getting smaller and growing older. Sales of Asahi's flagship Super Dry were down nearly 4% in the first 11 months of this year.
For now, the Japanese companies rank far behind global giants including AB InBev. Asahi had a 1.2% global share of the beer market in 2015, according to Euromonitor International.
Dealogic said that with Tuesday's beer deal, 2016 is now the second-biggest year on record for overseas acquisitions by Japanese companies, following 2012. Another Japanese beer maker, Kirin Holdings Co., bought a 55% stake in Myanmar Brewery for $560 million last year.
Despite the high price tag for its Europe purchases, Asahi may stay in the deal hunt. The company has expressed interest in bidding for Vietnamese state-owned brewer Saigon Beer Alcohol Beverage Corp., known as Sabeco, according to people familiar with the matter. An Asahi spokesman declined to comment.
Vietnam's government has invited global investment banks to pitch for a mandate to sell a stake in Sabeco worth at least a $1.8 billion, according to people familiar with the situation, kicking off what could be the largest sale of a Vietnamese state-run firm.
Write to Megumi Fujikawa at firstname.lastname@example.org and Atsuko Fukase at email@example.com