Carlsberg to purchase Baltika

Carlsberg has announced plans to buy out the remaining share in its Russian subsidiary Baltika.

The Danish company will pay close to US$1.15 billion for the 15% share as fourth quarter results showed a slow down in its key Russian market.

A spokesman told Reuters: “The Carlsberg Group will take the necessary steps to arrange for a delisting of Baltika as soon as possible. We currently expect this to happen not later than May 2012.”

Q4 results from the brewer were largely in line with forecasts and the brewer reported that profits were expected to be flat for 2012.

However, sales were declining in Northern and Western European markets and also in Russia where it is currently the leading brewing company.

The Russian market declined from 39.2% to 37.4% in 2011 and investment in Baltika is a sign that the company wishes to bolster this sector as 29% of revenue and 44% of operating profits came from its Eastern European business.

“In Russia, the steps we’ve taken to strengthen the business will begin to bear fruit in 2012. At the same time we’ll continue to explore acquisition opportunities in growth markets,” the brewer said.

Carlsberg announced operating profits in Q4 rose to 1.83bn Danish krone, up from 1.13bn the year before.

Sales in the same period rose from 13.40bn in 2010 to 14.85bn.