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AB InBev completes SABMiller acquisition

Carlos Brito, the chief executive of Anheuser-Busch InBev. File picture: Eric Vidal

Carlos Brito, the chief executive of Anheuser-Busch InBev. File picture: Eric Vidal

Published Oct 12, 2016


Johannesburg - Anheuser-Busch (AB) InBev yesterday announced that it had completed its more than $100 billion (R1.4 trillion) acquisition of rival SABMiller.

With the merger completed, InBev also announced the completion of Peroni, Grolsch and Meantime brands disposal.

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It is estimated that the combined company will have $55bn in annual sales and a 28 percent global market share.

“We will achieve more together than each of us could separately,” said AB InBev’s chief executive, Carlos Brito.

It has been reported that Japanese brewer Asahi will buy Peroni and Grolsch in the UK and Europe, as well as London’s Meantime.

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The transaction valued the business at €2.55bn (R39.29bn) on a debt-free/cash-free basis, as announced in February.

Dirk Steyn, the portfolio manager at Mergence Investment Managers, said the combined AB InBev was in a unique position to grow organic volumes and sales post the SABMiller acquisition.

“The organic sales profile is not only attractive with its exposure to Africa and Latin America where bottled beer consumption per capita is still low, it also has a proven portfolio on premium global brands that can be sold to a more aspiration beer market in the coming year.”

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Steyn said: “The combined entity has a very complementary footprint and is the first truly global beer company.”

The deal in South Africa included minority shareholders selling their stake in SABMiller to make way for a new company. Steyn said the minority shareholders ended up not having a good deal after Brexit as the pound weakened.

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“A year ago (a) South African investor was offered £44 or about R890 a share (later up to £45), roughly a 22 percent premium to the SABMiller share price before the bid.

“As the rand depreciated, SABMiller’s share price rallied to nearly R1 000 just before the Brexit vote. Unfortunately after the Brexit vote the South African SABMiller investors had to take the brunt of the pound's weakness, eventually receiving only about R778 per share,” he said.


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