‘Megabrew’ deal to cost 5,500 jobs and pay advisers $1.5bn in fees

AT LEAST 5,500 jobs around the world will be cut following Anheuser-Busch InBev’s £79bn takeover of FTSE 100 brewer SABMiller, it has been revealed, as it emerged the two companies have racked up almost $2bn (£1.5bn) in taxes and fees thrashing out the deal.

Stella Artois-owner AB InBev, a company that has a reputation for aggres- sive cost-cutting, expects to cut around 3pc of the combined workforce, including British employees, once the biggest takeover in UK corporate history – dubbed Megabrew – is finalised. The fees being paid to advisers such as investment bankers and lawyers, which total $1.5bn between the two brewers, are among the highest ever. AB InBev is also paying nearly $500m in taxes.

The job losses, disclosed in deal doc- uments published yesterday, equate to about 5,550 staff and are part of AB InBev’s plans to squeeze $1.4bn of annual cost savings from the tie-up four years after the deal closes.

“It is anticipated that these job reductions will be implemented gradually, in phases, over a three-year period following completion,” the companies, which are the world’s No 1 and 2 brewers, said. As part of the cost savings, SAB’s London head office, which is in Mayfair and has 51 staff, will be shut within 12 months of the deal closing. There are also expected to be job cuts at SAB’s main UK site in Woking, where it has 570 staff.

The final tally of cuts is likely to be higher, however, because while AB InBev has been able to undertake some integration planning it has not yet assessed sales and front-office supply roles. SAB has about 70,000 staff, although that figure includes employees at a number of businesses, including Peroni, Grolsch and its US joint venture, that AB InBev will sell to assuage competition concerns. AB InBev has about 150,000 employees.

A host of bankers from firms including JP Morgan, Barclays, Goldman Sachs, and Lazard, and lawyers from firms such as Linklaters and Freshfields Bruckhaus Deringer will share in a $1.94bn bonanza in fees and taxes for their work on what is third-biggest deal in global corporate history.

The combined sum paid to bankers puts the fees among the top three paid to financial firms, according to estimates by Dealogic. The companies revealed details of the takeover to investors in preparation for key shareholder votes on the deal on Sept 28.