Megabrew: AB InBev-SABMiller deal bubbles along down under
The so-called megabrew deal between Anheuser-Busch InBev and SABMiller took a step closer to becoming a reality today, after it received a thumbs up from Australia's antitrust watchdog.
The Australian Competition and Consumer Commission (ACCC) has said it will not oppose AB InBev's takeover of SABMiller, concluding the proposed £71bn tie-up would be unlikely to result in rocketing costs of beer for customers.
"The ACCC found that the proposed acquisition would not significantly change the current market structure," remarked ACCC chairman Rod Sims.
"The two largest suppliers of beer in Australia are Lion and SABMiller, which owns Carlton & United Breweries (CUB). While AB InBev’s brands have been successful in Australia, particularly Corona, they have previously been distributed via either Lion or CUB. AB InBev has only a limited direct company presence in Australia and does not brew beer here."
However, AB InBev, which also owns Stella Artois and Budweiser, has had to terminate its distribution agreement with Lion to make sure the deal would get the go ahead in Australia.
"The termination of the distribution arrangements therefore resolved the ACCC’s competition concerns," said Sims.
Since formally announcing the deal last year, AB InBev has had to make a number of concessions to appease competition watchdogs, including agreeing to sell popular SABMiller brands Peroni and Grolsch to Asahi.
AB InBev has also launched a secondary listing on the Johannesburg stock exchange as part of the deal process.
Regardless, some jurisdictions have been digging their heels in. Last month, the American Antitrust Institute wrote to the US Department of Justice to express its concerns that the proposed arrangement "raises serious competitive concerns in the US beer market".
Meanwhile, the European Commission has said that it will decide later this month whether it wishes to clear the deal.
Yesterday, AB InBev announced alongside its quarterly results that the deal was making "good progress" in obtaining the regulatory clearances the companies needed.