KKR sells Korea's Oriental Brewery for $5.8bn KKR and local partner Affinity Equity Partners are selling South Korea's Oriental Brewery back to original owner Anheuser-Busch InBev for $5.8bn including debt, in a deal that sees the US buyout group make a more than five-fold return on its money. The acquisition puts an Asian brand back in the hands of AB InBev, the world's largest brewer, at a time when the $258bn beer market in the region is growing twice as fast as the rest of the world. Under KKR's ownership the past five years, Oriental Brewery's market share has risen from 40 per cent to 60 per cent of the local beer market, in spite of heavy regulation, price controls and stiff taxes in South Korea. Yet the country also has its attractions, including beer volumes that grew at an annual rate of approximately 2 per cent between 2009 and 2012 - a time when thirsts in markets like the US and Japan were waning. South Korea's beer market, of which Oriental Brewery and domestic rival Hite Brewery control over 90 per cent, is expected to grow by more than 13 per cent in total in the decade to 2022. The success of Oriental Brewery will doubtless be trumpeted both by KKR and its rivals as an illustration of what private equity, especially foreign, can do for the companies it invests in. Generally, foreign buyout firms are looked upon in Asia as preying on ailing companies for their own benefit. In the past, private equity did brisk business buying distressed companies, especially at the time of the Asian financial crisis. In recent years it has become harder to find bargain investments and to make many multiples of the money invested, as TPG did with some of its bank deals in the region and Carlyle with its investment in insurer China Pacific. KKR bought Oriental Brewery in the summer of 2009 from AB InBev in a deal that valued the beer maker at $1.8bn including debt, and wrote an equity check of $750m. The US private equity group then struck a deal to sell a 50 per cent stake to South Korean fund Affinity Equity Partners for $400m. InBev had just completed the purchase of Anheuser Busch and needed to raise cash to pay down the debt from that transaction. As part of that deal, InBev had the option to buy back the Korean beer maker within five years, according to a formula based on a multiple of earnings before interest, depreciation, taxation and amortisation. In 2013, Oriental Brewery generated about $500m in ebidta. The Oriental Brewery transaction was the largest and most profitable investment for KKR's first Asia fund. The private equity group has already started investing from its second Asia fund. It has raised $6bn from investors and has signed up deals from Japan to Malaysia, and India though two of the three have yet to close. Carlyle and TPG, among others, also are raising Asia funds though they are expected to be far smaller. Joe Bae, head of KKR in Asia, is now seen as one of the candidates to eventually run the entire firm as a result of successful investments such as Oriental Brewery.