Tribeca, a Bogota, Colombia-based private equity firm, has sold Bogota Beer Company (BBC) to industrial brewing giant AmBev, according to a statement by the firm.
While financial terms weren't disclosed, Tribeca's exit enabled the Colombian firm to realize a 30% internal rate of return. The deal marked the nine year old firm's second realisation in 2015.
Tribeca acquired its 40 percent stake in the Bogota Beer Company, Colombia's largest craft brewery with an 80 percent market share and 14 different beers, in 2013. Following its purchase, Tribeca embarked on a three-pronged growth strategy for BBC that included growing its pub network through a geographic expansion from its existing 13 locations at the time of the investment, as well as building a new brewing plant and revamping its distribution strategy, said Jaime Ramirez, a director at Tribeca.
“What was interesting about this company was that we found it had strong brand awareness, mostly in Bogota. Young people in the city identified with the craft beer concept, so we found it was a great opportunity to grow the brand and expand it into other cities,” Ramirez told Private Equity International.
Ramirez declined to comment on the firm's cash on cash return, citing confidentiality reasons.
BBC is also a seller of nine seasonal beers, including porters, stout, red ale and Belgian-style beers, according to Ramirez.
As part of its expansion that more than doubled BBC's British-style pubs to 27 in the first two years of Tribeca's ownership period, BBC established a foothold in the city of Medellin in 2014. At the same time the brewing company also opened locations in the popular coastal tourist city of Cartagena, along with pubs in the industrialised city of Barranquilla and Santa Marta.
While lager-style beers still dominate the Latin American beer market, Ramirez said micro beers have taken off in Colombia where “demand has been growing for craft beer and BBC is partly responsible for that,” he said.
BBC represented a “proprietary” rather than auction-sourced deal for the firm, the Tribeca dealmaker noted.
Holland & Knight served as counsel to Tribeca, which has $400 million in asset under management and 12 companies spread between the infrastructure operations, healthcare, natural resources, energy, and consumer goods sectors in its portfolio.