A-B InBev Completes $107 Billion Bid For SABMiller To Create “Truly Global Brewer”November 11, 2015
Anheuser-Busch InBev (ABI) has agreed to acquire archrival SABMiller for £71 billion ($107b), but the newly-formed brewing behemoth will be competing against the Miller portfolio in the U.S. market.
ABI announced the deal to form what it calls the first “truly global brewer” earlier today, just hours after agreeing to sell SABMiller’s majority interest in MillerCoors—the U.S. market’s second-leading beer marketer—to Molson Coors. Under the terms of that deal, Molson Coors—which currently owns a 42% stake in MillerCoors—will pay approximately $12 billion for the remaining 58% of the jv. The Colorado-based Molson Coors will also obtain ownership of the Miller brands outside the U.S., conditional on the completion of the ABI-SABMiller deal.
ABI engineered a similar move in 2013, when it acquired Mexico’s Grupo Modelo for $20 billion. In order to allay antitrust concerns in that deal, ABI agreed to sell the U.S. rights to the Modelo range to Constellation Brands, including two of the U.S. market’s top 10 beer brands—Corona Extra and Modelo Especial.
While the ABI-SABMiller blockbuster wouldn’t alter the new entity’s position in the U.S. market—where ABI currently has a market share of nearly 50% even after years of decline for its flagship Budweiser brand—it would create a brewing force with unparalleled global scale and reach. If the deal is completed—competition concerns remain in other markets, such as China and South Africa—the new company would have annual revenue of around $65 billion, and sell nearly one in three beers consumed around the world. Crucially for ABI, the addition of SABMiller would give the world’s biggest brewer a strong presence in Africa, where it’s currently only a bit player, and solidify its leadership in Latin America (where ABI already dominates markets like Brazil, Mexico and Argentina).Subscribe to Shanken News Daily’s Email Newsletter, delivered to your inbox each morning.