Heineken in talks with Kirin to buy its Brazilian beer business
Heineken is meeting with the Japanese company to discuss the acquisition of Brasil Kirin, which could cost £705 million – a severe discount when it was valued at $4 billion in 2011.
Beer companies are springing into action following the ground-breaking merger between AB InBev and SAB Miller, with Heineken also acquiring 2,000 Punch Taverns pubs in the UK, a transaction costing £400 million. It was reported in September 2016 that Kirin was looking for partnerships to improve its Brazilian business, as despite Brazil being the third largest beer market globally, the nation has been in recession since 2014.
John Colley, a Professor of Practice in the Strategy and International Business Group at Warwick Business School, stated: "Heineken's new Brazilian purchase will need investment for some years but in the medium term will be a good buy.
"In effect the Heineken strategy is to acquire low risk bolt-on acquisitions to build share in long term growth markets. There is usually opportunity in crises and Heineken certainly sees one in Brasil Kirin.
"Heineken, now the world's second biggest brewer, has responded to AB InBev's $106 billion foray into growth markets buying SAB Miller by snapping up a troubled Brazilian Brewer.
"The Japanese Brewer Kirin acquired control in 2011 valuing the business at around $5.5 billion. However, the poor Brazilian economy has resulted in attempts to dispose of the loss-making brewery. The $870 million price tag suggests that competition to buy these operations has not been that intense.
"Heineken has Brazilian operations which will allow some integration and it also has Femsa which is a major South American Brewer based in Mexico but operating throughout South America. In effect Heineken has the infrastructure and local management to integrate the operations, remove cost and develop improved distribution which is key to the brewing industry."
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Ultium Cells LLC/Li-Cycle: Sustainable Battery Manufacturing
Ultium Cells LLC - a joint venture between General Motors and LG Energy Solutions - has announced its latest collaboration with Li-Cycle. Joining forces the two have set ambitions to expand recycling in North America, recycling up to 100% of the scrap materials in battery cell manufacturing
What is Ultium Cells LLC?
Announcing their partnership in December 2019, General Motors (GM) and LG Energy Solutions established Ultium Cells LLC with a mission to “ensure excellence of Battery Cell Manufacturing through implementation of best practices from each company to contribute [to the] expansion of a Zero Emission propulsion on a global scale.”
Who is Li-Cycle?
Founded in 2016, Li-Cycle leverages innovative solutions to address emerging and urgent challenges around the world.
As the use of Lithium-ion rechargeable batteries in automotive, industrial energy storage, and consumer electronic applications rises, Li-Cycle believes that “the world needs improved technology and supply chain innovations to better recycle these batteries, while also meeting the rapidly growing demand for critical and scarce battery-grade materials.”
Why are Ultium Cells LLC and Li-Cycle join forces?
By joining forces to expand the recycling of scrap materials in battery cell manufacturing in North America, the new recycling process will allow Ultium Cells LLC to recycle cobalt, nickel, lithium, graphite, copper, manganese and aluminum.
“95% of these materials can be used in the production of new batteries or for adjacent industries,” says GM, who explains that the new hydrometallurgical process emits 30% less greenhouse gases (GHGs) than traditional processes, minimising the environmental impact. Use of this process will begin later in the year (2021).
"Our combined efforts with Ultium Cells will be instrumental in redirecting battery manufacturing scrap from landfills and returning a substantial amount of valuable battery-grade materials back into the battery supply chain. This partnership is a critical step forward in advancing our proven lithium-ion resource recovery technology as a more sustainable alternative to mining, " said Ajay Kochhar, President, CEO and co-founder of Li-Cycle.
"GM's zero-waste initiative aims to divert more than 90% of its manufacturing waste from landfills and incineration globally by 2025. Now, we're going to work closely with Ultium Cells and Li-Cycle to help the industry get even better use out of the materials,” added Ken Morris, Vice President of Electric and Autonomous Vehicles, GM.
Since 2013, GM has recycled or reused 100% of the battery packs it has received from customers, with most current GM EVs repaired with refurbished packs.
"We strive to make more with less waste and energy expended. This is a crucial step in improving the sustainability of our components and manufacturing processes,” concluded Thomas Gallagher, Chief Operating Officer, Ultium Cells LLC.