Sector News

AB InBev sells SABMiller assets to Japan's Asahi Group

April 4, 2017
Food & Drink

Beer brewing behemoth, Anheuser-Busch InBev SA/NV BUD, alias AB InBev, moves another step closer to fulfilling its requirements for the mega-merger with SABMiller Limited (earlier known as SABMiller Plc).

The company closed the previously agreed sale of some of SABMiller’s eastern European businesses to Japan’s Asahi Group Holdings, Ltd. for €7.3 billion (or US$7.8 billion).

Under the agreement signed on Dec 13, 2016, the company disposed SABMiller’s businesses in five countries namely, Poland, Czech Republic, Slovakia, Hungary and Romania (termed as CEE Business). These included leading beer brands like Pilsner Urquell, Kozel and Tyskie. Further, the divestiture is in sync with AB InBev’s pact with the European Commission in May 2016.

While the disposal of these assets only fulfills AB InBev’s antitrust commitments, the purchase has significant importance for Asahi as it presents a lucrative opportunity to diversify outside its home market, where the brewers’ are plagued by an aging and shrinking population.

Additionally, this acquisition complements Asahi’s previous buy of the Western European brewing assets from AB InBev for €2.55 billion, including SABMiller’s premium beer brands Peroni and Grolsch, and British craft brewer Meantime. Together, the assets acquired from AB InBev provide Asahi the platform to expand in Europe and establish itself as a global player. Further, the recent acquisition will bring the company to the third spot among the Asian brewers.

Coming back to AB InBev, the company signed many other similar deals in various countries to win regulatory nod for the SABMiller buyout. The most prominent one in the lot is definitely the sale of SABMiller’s 58% stake in the MillerCoors LLC joint venture (JV) to Denver-based Molson Coors Brewing Company TAP for $12 billion. This makes Molson Coors, which previously held a 42% stake in MillerCoors, the 100% stakeholder in the JV. Molson Coors now has full rights to all the brands in the MillerCoors portfolio for the U.S. market, including Redd’s and import brands such as Peroni and Pilsner Urquell.

Moreover, the company has agreed to sell SABMiller’s 26.4% stake in Distell Group Limited, a South African distiller of wine, spirits, and ciders to Africa’s largest pension administrator, the Public Investment Corporation (SOC) Limited. Further, the company agreed to divest 54.5% stake in Coca-Cola Beverages Africa (“CCBA”) to the soft-drinks giant The Coca-Cola Company KO for $3.15 billion.

Despite these divestitures, we note that the combined mega-brewing company still holds the top spot in the beer industry, controlling about one-thirds of the global beer market. This behemoth, which accounts for nearly 30% of global beer sales and 46% of global beer profits, leaves Heineken NV HEINY trailing in the second spot, with only 11% share of the global beer market.

AB InBev also retains its leading position in the U.S., with 44% share in the beer market, while Molson Coors has grown incredibly to become the second-largest brewer controlling about 25% market share.

Source: Zacks via Yahoo Finance

comments closed

Related News

September 25, 2022

Coca-Cola names new president of global ventures

Food & Drink

The Coca-Cola Co. has promoted Evguenia (Jeny) Stoichkova to president of global ventures, effective Jan. 1, 2023. Ms. Stoichkova joined Coca-Cola Bulgaria in 2004 and was most recently the president of the company’s Eurasia & Middle East division, a role she has held since 2021.

September 25, 2022

Perfect Day allies with Onego Bio to speed-up launch of animal-free eggs

Food & Drink

US-based Perfect Day, is partnering with Onego Bio, which specializes in creating animal-free eggs, aiming to accelerate the timeline to bring the eggs to the market. The business, with the use of its technology, plans to commercialize animal-free ovalbumin, the most abundant egg white protein extracted through precision fermentation.

September 25, 2022

EU fails on food waste: Report reveals bloc discards more than it imports

Food & Drink

Food waste costs the EU €143 billion per year (US$141.7 billion), with a report by Feedback EU raising the alarm of how it’s vital to reduce waste from farm to fork 50% by 2030 and the only way this will be achieved is by enforcing a mandatory directive forcing the food industry to do better and retailers to pay a tax of food waste.