South African unions deter SAB takeover

POWERFUL unions in south Africa have called on competition regulators to block the £68bn takeover of Peroni maker sABMiller by Anheuser-Busch InBev.

London-listed sAB is Africa’s biggest brewer with a heritage dating back 120 years. But workers’ groups in south Africa fear the deal will trigger job cuts.

Budweiser owner InBev has a track record of growing by debtfuelled acquisitions and repaying loans through fierce cost-cutting.

south Africa’s Food and Allied Workers Union (FAWU) said it would oppose the merger as did the Congress of south African Trade Unions (Cosatu). It said the government, regulators and pension funds should not agree to the takeover, which would create the world’s largest brewer, bringing together a host of lagers including stella Artois, Peroni and Budweiser.

The deal would also trigger a huge payday for sAB chief executive Alan Clark, who stands to walk away with £70m from the shares and options he holds.

It is possible that the government could block the deal if it looks like jobs may be affected, or the amount of taxes collected reduced. A delay is more likely while specific assurances are negotiated. sAB employs around 8,800 workers in south Africa and contributed £780m in local tax revenues.

A spokesman for Cosatu said: ‘sABMiller was built on the back and by the hard work of the south African workers and they deserve to be heard and given assurances with respect to the security of their jobs.’

sABMiller (down 35p to 3958.5p) will receive a £2bn consolation prize if InBev fails to pull off its bid. The Peroni maker has negotiated what is thought to be the biggest break fee on the London market, to be paid as compensation if the £68bn takeover by its bigger rival is blocked by regulators or falls apart.