SAB forced to sell beers to seal AB tie-up

SABMILLER will be forced to sell its Chinese beer brand to clear competition hurdles as a result of its £177bn brewing takeover by ABInBev, analysts have warned.

The two companies are in talks to create an industry titan with brands that include Stella Artois, Budweiser and Peroni.

But a raft of second-tier brands could be offloaded in order to appease regulators.

The deal, which is still being crafted, has to be given the green light by regulators in every country where they both operate.

Analysts are broadly in agreement over which brands must be sold. In the US, SAB has a 58pc stake in the MillerCoors operation, whose chief brand is Coors Light with a 30pc share of the US beer market.

Analyst James Jones at RBC said US competition authorities ‘are likely to be extremely resistant to Anheuser-Busch InBev acquiring a single additional litre of beer market share in the US’.

He added: ‘We assume that the entire Miller Coors business will need to be sold outright.’

While 42pc holder MolsonCoors has the right to buy a majority stake, analysts at Deutsche expect SAB to offload the remainder of the business q quite p profitably.y In China, SAB enjoys a 23pc share of the market through a deal with l ocal group China Resources Enterprise to produce the Snow brand. But AB InBev has a 15pc share of the same market – making it possible that SAB will be forced to offload Snow.

Analysts at Deutsche said the business could be worth £5bn.

Other businesses that could be sold include Grolsch in the Netherlands and Ursus in Romania.

The driver for the deal is for AB InBev to gain access to SAB’s fastgrowing African markets. Under UK takeover rules, AB InBev has until October 14 to table a formal offer or walk away for six months.

SAB slipped 20p to 3600p.