First Citizens Bank Provides $33.5 Million to Adams Beverages

Rhea-AI Summary

First Citizens Bank's Middle Market Banking division provided $33.5 million in financing to Adams Beverages, a distributor of alcoholic and non-alcoholic beverages in Alabama and North Carolina. The loan refinanced three properties serving as distribution facilities for Adams Beverages.

Financial Analyst

The provision of a $33.5 million financing package by First Citizens Bank to Adams Beverages signifies a robust investment into the distribution sector, particularly within the beverage industry. This strategic move by Adams Beverages to refinance three properties suggests a consolidation of assets that could enhance operational efficiency and reduce overhead costs related to their North Carolina operations.

From a financial perspective, the exclusive franchise rights for Anheuser-Busch Inbev products held by Adams Beverages represent a substantial competitive edge, as these products often command significant market share. The funding could be indicative of Adams Beverages' intent to leverage these rights more effectively, possibly through facility upgrades or expansion of distribution networks, which could, in turn, lead to increased revenue streams.

Investors should note that such a financing deal usually reflects confidence in the borrower's business model and future growth potential. However, it also adds debt to the company's balance sheet, which could impact its financial ratios and, by extension, its creditworthiness. The long-term success of this financial strategy will largely depend on the company's ability to manage this debt and generate sufficient returns on the investment.

Market Research Analyst

Adams Beverages' expansion within the 38 counties in Alabama and 28 counties in North Carolina through strategic acquisitions and organic growth is a significant development in the beverage distribution market. The financing from First Citizens Bank could facilitate further market penetration or the adoption of innovative distribution strategies to stay competitive.

It's important to consider the broader market implications of this deal. The beverage industry is highly competitive and distribution plays a critical role in the success of beverage companies. With Adams Beverages holding exclusive franchise rights for Anheuser-Busch Inbev products, they are well-positioned to capitalize on brand loyalty and consumer preferences within their territories.

For stakeholders, the potential benefits include increased market share and stronger brand presence. However, the industry is also subject to regulatory changes and shifts in consumer behavior, such as the growing trend towards healthier lifestyle choices, which could affect the demand for certain beverage categories. Monitoring these trends will be crucial for Adams Beverages to maintain its growth trajectory and for investors to assess the long-term sustainability of the business.

RALEIGH, N.C., March 11, 2024 /PRNewswire/ -- First Citizens Bank today announced that its Middle Market Banking business provided $33.5 million in financing to Adams Beverages, a distributor of beer, wine and nonalcoholic beverages to bars, restaurants, grocery stores, package stores and other retail outlets throughout Alabama and North Carolina.  

Within its distribution territories - which include 38 counties in Alabama and 28 counties in North Carolina - the third-generation family-owned Adams Beverages has exclusive franchise rights for Anheuser-Busch Inbev products and several national and regional breweries.

"We appreciate the expertise of First Citizens' Middle Market Banking team in arranging this financing, as well as their knowledge of the business landscape in the Southeast region in which we operate," said Clay Adams, President of Adams Beverages.

The loan refinanced three properties that are occupied by Adams Beverages and serve as distribution facilities for the company's North Carolina operations.

"We're pleased to provide financing to support the business goals of Adams Beverages, a company with a strong track record of expanding their market share through organic growth and strategic acquisitions," said Brendan Chambers, Head of First Citizens Middle Market Banking. "We look forward to future opportunities to support Adams Beverages' growing business."

First Citizens Middle Market Banking delivers a range of financial solutions to midsize clients through a relationship banking model. The business offers deposit solutions, loans, treasury services and other banking products to manufacturers, distributors and a wide variety of service industries.

About First Citizens Bank
First Citizens Bank helps personal, business, commercial and wealth clients build financial strength that lasts. Headquartered in Raleigh, N.C., First Citizens has built a unique legacy of strength, stability and long-term thinking that has spanned generations. First Citizens offers an array of general banking services including a network of more than 500 branches and offices in 30 states; commercial banking expertise delivering best-in-class lending, leasing and other financial services coast to coast; innovation banking serving businesses at every stage; and a nationwide direct bank. Parent company First Citizens BancShares, Inc. (NASDAQ: FCNCA) is a top 20 U.S. financial institution with more than $200 billion in assets. Discover more at firstcitizens.com.

MEDIA RELATIONS:
Lexa Tutela Losey
212-461-5305
Lexa.tutela@firstcitizens.com 

 

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SOURCE First Citizens Bank

How much financing did First Citizens Bank provide to Adams Beverages?

First Citizens Bank provided $33.5 million in financing to Adams Beverages.

What type of beverages does Adams Beverages distribute?

Adams Beverages distributes beer, wine, and nonalcoholic beverages to various retail outlets.

What are the exclusive franchise rights held by Adams Beverages?

Adams Beverages holds exclusive franchise rights for Anheuser-Busch Inbev products and several national and regional breweries.

Who is the President of Adams Beverages?

Clay Adams is the President of Adams Beverages.

What financial solutions does First Citizens Middle Market Banking offer?

First Citizens Middle Market Banking offers deposit solutions, loans, treasury services, and other banking products to midsize clients.