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AB InBev Gains U.S. Approval For SABMiller Deal, With Caveats

July 21, 2016

Anheuser-Busch InBev (ABI) passed a crucial hurdle in its quest to close its pending $100-billion-plus acquisition of SABMiller, as the U.S. Department of Justice (DOJ) approved the transaction, with certain requirements.

Under the terms of its “consent decree” with the DOJ, ABI will divest SABMiller’s 58% interest in MillerCoors to joint venture partner Molson Coors for about $12 billion, as previously announced. Additionally, ABI has pledged not to terminate any U.S. wholesalers as a result of the SABMiller acquisition, and agreed not to acquire any distributors that would result in more than 10% of its annual volume being distributed through wholly-owned U.S. distributorships. Also, ABI will abandon its recently introduced program to incentivize distributors to make up 98% of sales with ABI brands.

In a statement, ABI CEO Carlos Brito said, “We will continue to invest heavily in the U.S., including our efforts to build our entire portfolio of brands, support and incentivize our wholesalers, and compete effectively in a dynamic and fast-changing market. While we will make some adjustments to certain aspects of our U.S. sales programs and policies, our fundamental approach and commitment to this market will not change.”

Both the Justice Department and the Brewers Association, which represents craft brewers, issued statements lauding the concessions won from ABI in the deal. Deputy Assistant Attorney General Sonia Pfaffenroth said the settlement “preserves the ability of smaller brewers…to compete against ABI by protecting their access to important distribution networks.” With U.S. approval in hand, ABI expects the SABMiller deal to close before the end of the year. —Daniel Marsteller

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