U.S. blesses mar­riage of two brew­ing giants

The Hamilton Spectator - - BUSINESS - RE­NAE MERLE Wash­ing­ton Post

WASH­ING­TON — The United States Jus­tice Depart­ment has cleared the $100 US bil­lion merger of the world’s largest beer mak­ers, An­heuser-Busch InBev and SABMiller, in a deal that would cre­ate a global gi­ant con­trol­ling much of the world’s brew.

U.S. an­titrust of­fi­cials spent more than a year study­ing the deal, con­cerned the com­bined new com­pany would have too much mar­ket power and drive up prices. But the com­pa­nies agreed to take sev­eral steps to ad­dress those con­cerns, in­clud­ing SABMiller di­vest­ing its en­tire U.S. busi­ness and give up world­wide Miller beer brand rights. As a re­sult, the com­pet­i­tive land­scape in the U.S. will re­main the same, ac­cord­ing to the Jus­tice Depart­ment.

“The rem­edy we se­cured will help pre­serve and pro­mote com­pe­ti­tion in the multi­bil­lion-dol­lar U.S. beer in­dus­try,” So­nia Pfaf­fen­roth, deputy as­sis­tant at­tor­ney gen­eral, said Wed­nes­day.

Still, the merger puts some of the coun­try’s most pop­u­lar beers un­der one roof: An­heuser-Busch InBev’s Bud­weiser and Corona and SABMiller’s Peroni. An­heuser-Busch InBev’s Bud Light alone ac­counts for one in ev­ery five beers sold in the United States.

An­heuser-Busch InBev, which is based in Belgium and SABMiller, which is based in Lon­don, have held the No. 1 and No. 2 spots in the beer mar­ket for at least a decade, ac­cord­ing to data from Euromon­i­tor. The com­pa­nies cur­rently con­trol 70 per cent of the U.S. beer mar­ket and 30 per cent of the global mar­ket, ac­cord­ing to the re­search group.

But global beer sales have started to slow and tra­di­tional beer mark­ers are fac­ing more com­pe­ti­tion from smaller craft brew­ers.

The merger could give the com­bined com­pany the lever­age to en­ter new mar­kets, in­clud­ing in Africa and Latin Amer­ica. The com­bi­na­tion will also al­low the com­pa­nies to save money on in­gre­di­ents, pack­ag­ing, dis­tri­bu­tion and the many other ex­penses that come with run­ning a world­wide en­ter­prise. Per­haps, more im­por­tantly, the takeover could put the new com­pany in a bet­ter po­si­tion to com­bat the rise of smaller craft brew­ers.

KIRSTY WIGGLESWORTH, THE AS­SO­CI­ATED PRESS

An­heuser-Busch InBev, which is based in Belgium and SABMiller, which is based in Lon­don, have held the No. 1 and No. 2 spots in the beer mar­ket for at least a decade, ac­cord­ing to data from Euromon­i­tor.

Newspapers in English

Newspapers from Canada

© PressReader. All rights reserved.