AB InBev eyes £75bn SABMiller takeover
Global beer giant AB InBev is preparing to secure funds of up to £75 billion (US$122bn) to buy rival UK brewer SABMiller, according to reports by the Wall Street Journal.
According to the business journal’s source, the company is in talks about how to finance a potential takeover of SABMiller, which if accepted would bring together the world’s two largest brewers.
There has been speculation within the brewing industry for months that SABMiller could be targeted by the world’s number one brewer AB InBev, amid rumoured moves by Diageo to make the acquisition.
According to reports AB InBev is not in “active discussions” with SABMiller, but is shoring up its finances before making a formal approach.
Renewed speculation of a takeover by AB InBev comes as news emerged today that a bid by SABMiller for Heineken was rejected.
Should SABMiller and AB InBev merge, one company would control nearly a third of the world’s beer supply with analysts predicting AB InBev would likely have to sell SABMiller’s stakes in two joint ventures, MillerCoors in the US and CR Snow in China.
Should two deals take place, one to acquire SABMiller and another Heineken, one company could potentially own virtually all of the world’s biggest beer brands.
It would dwarf Japanese drinks group Suntory’s recent acquisition of Beam Inc to create Beam Suntory Inc – a deal worth US$16 billion.
AB InBev’s last acquisition was in 2013 when it bought the remaining half of the Mexican brewer Grupo Modelo that it didn’t already own.
According to data from Euromonitor, AB InBev held a 20% share of the global beer market in 2013 followed by SABMiller and Heineken.
AB InBev has a history of large scale acquisitions. In 2004 Brazil’s AmBev and Belgium’s Interbrew merged to create InBev. It later acquired Anheuser-Busch to become AB InBev in 2008 in a deal worth $52 billion.