Hicks Muse to Acquire Heileman Brewery : Acquisitions: The firm is known for leveraged buyouts. Insiders doubt it will go for nationwide beer marketing.

The investment firm Hicks, Muse & Co. said Monday that it is buying G. Heileman Brewing Co., the fifth-largest U.S. brewer, for $390 million.

Hicks Muse said it has signed a definitive agreement with Heileman, which is privately held. The deal is expected to be completed by mid-January.

Heileman, based in La Crosse, Wis., has a 5% share of the U.S. beer market, with 1993 sales estimated at $900 million. Its brands include Lone Star, Rainier, Colt 45, Old Style, Special Export, Schmidt’s, Henry Weinhard’s, Mickey’s, Champale and nonalcoholic Kingsbury.

Thomas J. Rattigan, current chairman and chief executive of Heileman, called the deal a “culmination of our efforts to properly position Heileman for continued profitable growth and long-term success.”

Rattigan will be replaced by William J. Turner, principal of Turner & Partners, a management services affiliate of Hicks Muse.

The announcement surprised industry insiders, who had expected another brewer to purchase Heileman, said Eric Shepard, executive editor of the trade publication Beer Markets Insights.

The price was higher than expected, he said. Beer Markets Insights had estimated a sale price of between $300 million and $350 million.

“I don’t think it’s really clear yet exactly what they’re going to do,” Shepard said of Heileman. “I would be surprised if they would try to be a big, new national brewer. My guess is that they’ll probably try to exploit regional strength.”

Hicks Muse, which specializes in leveraged acquisitions, owns no other brewery but has several years of beverage experience.

Thomas O. Hicks, chairman and chief executive of Hicks Muse, was co-chairman and co-chief executive of Hicks & Haas when it acquired Dr Pepper Bottling Co. and A&W; Brands in leveraged buyouts in the mid-1980s, said Roy Winnick, spokesman for Hicks Muse.

But Shepard said experience in the soft drink industry will not necessarily mean success in the beer business.

“There have been plenty of examples of people who’ve come over from the soft drink business and not done well, so it doesn’t automatically translate. It won’t necessarily hurt, but you can’t really tell,” he said.

In the last three years, Hicks Muse has been involved in 16 transactions totaling more than $3 billion, and retains control of those companies, Winnick said.

The deals include the 1991 acquisition of Houston-based Trident NGL for $665 million, the 1993 purchase of Berg Electronics for $370 million and the $530-million purchase of the Colorado-based insurance company Life Partners Group in March, 1990, he said.

Hicks Muse said former A&W; Brands chief Lou Lowenkron and Jim Turner, chairman and chief executive of Dr Pepper Bottling Co. of Texas, will be investors and join the Heileman board.

Heileman completed a financial reorganization in 1991. The brewer has about 2,200 employees in Chicago and at breweries in La Crosse, San Antonio, Baltimore, Seattle and Portland, Ore.