'33' For Sale again

[ORIGLS6]

From Monday's Wall Street Journal:

Brewing giant Anheuser-Busch InBev NV is exploring the sale of its storied but struggling Rolling Rock brand, according to people familiar with the matter.

The potential sale comes three years after Anheuser-Busch Cos. bought Rolling Rock from Belgian brewer InBev NV for $82 million.

InBev, whose brands include Stella Artois, acquired Anheuser-Busch for about $52 billion this past autumn to form the world's largest beer maker by sales, and is selling assets to help repay debt from the deal.

Sales of Rolling Rock, whose ad slogan is "Born Small Town," have been on the decline in recent years. But the brand could appeal to beer companies seeking to expand in the U.S. market by scooping up an established name. The pale lager, which originated 70 years ago in Latrobe, Pa., is sold in distinctive green bottles, and is most popular in the eastern U.S.

A spokeswoman for Anheuser-Busch InBev, which is based in Leuven, Belgium, declined to comment on the possibility of a sale.

The company sounded out potential bidders for Rolling Rock early this year through investment bank Lazard Ltd., but wasn't satisfied with any of the offers, according to one person familiar with the matter. The brewer, however, remains interested in selling the brand.

One possible suitor could be North American Breweries Inc., owned by New York private-equity firm KPS Capital Partners LP. KPS formed the company in February after reaching deals to acquire two brewers in upstate New York: High Falls Brewing Co. and Labatt USA. It purchased Labatt USA, which imports and markets Canada's Labatt Blue, from Anheuser-Busch InBev for an undisclosed price.

A KPS spokesman declined to comment.

Another potential suitor could be C2 Imports LLC, which also vied for Labatt USA. C2 Imports is a California-based beer importer led by former Anheuser executive Charlie Cindric.

When Anheuser bought Rolling Rock in 2006, it sought to reposition the brand to compete in the fast-expanding, small-batch "craft" beer segment. But sales, which already were declining under InBev, have continued to wane.

Last year, Rolling Rock sales slipped 13% from a year earlier in volume terms to 7.4 million cases, according to Beverage Information Group, a market-research firm in Norwalk, Conn. In 2004, Rolling Rock sold nearly 11 million cases.