AMBEV Brasil, a subsidiary of Budweiser brewer Anheuser-Busch InBev, has secured deals to buy 51 per cent of Dominican Republic-based beverage manufacturer, CND for US$1.2 billion ($105 billion).

The purchase will make the combined entity the leading beverage company in the Caribbean.

The combined business, which will include beer, malt and soft drinks operations in the Dominican Republic (DR), Antigua, Saint Vincent and Dominica, is projected to control 42.7 per cent of the beer market in the Caribbean and 37.3 per cent of the beverages market when carbonated drink sales are included.

In a presentation on the strategic alliance in the Caribbean, Ambev (Companhia de Bebidas das Americas) proposed that the integration of its beverage business with Cerveceria Nacional Dominicana SA (CND) will “generate efficiencies and opportunities for sharing best practices”.

It also pointed to significant opportunities to further expand CND’s flagship beer — Presidente — internationally and bring more innovation and international brands to the region.

The company’s distribution network currently exports to 16 Caribbean countries outside the four where it has bottling facilities, as well as the US and Europe.

Importantly, the deal would result in base net revenues of approximately US$570 million, as reported in 2011, and expected estimated combined earnings before interest, tax, depreciation and amortisation (EBITDA) for the first 12 months of operations of approximately US$190 million.

The transaction requires that Ambev hand over US$1 billion in cash and all its shares in its DR operations — Ambev Dominicana SA — in exchange for 41.76 per cent of the shares in CND. Ambev will also acquire another 9.3 per cent of the shares in CND from Heineken NV for US$237 million at the closing date, expected by the end of June.

The structure of the transaction, which includes various put and call options, should also result in Ambev eventually owning more than 90 per cent of CND.

The alliance “brings together Ambev’s management capabilities with CND’s well-established operational strength and footprint in the region,” Ambev said earlier this week.”

The company will operate under the name CND.

Anheuser-Busch InBev reported global revenue of US$39 billion and EBITDA of US$15.1 billion in 2011.