30 Jun 2016 AB InBev’s SABMiller purchase gets nod in SA, with tweaks

The green light from the Competition Tribunal for the acquisition by AB InBev was an important milestone, as SABMiller, which was founded in Johannesburg, is a major employer in South Africa and there were concerns the country could seek to block the takeover.

The South African decision means that Belgian-Brazilian giant AB InBev, which also owns Budweiser, has now secured clearance for the acquisition in 16 jurisdictions, although it still needs approval in the US and China.

Both are expected to green light the deal, however, after AB InBev agreed to sell SAB’s key businesses in the two countries, paving the way for the takeover to complete in the second-half of 2016.

South Africa’s acceptance of the merger is a boost for bosses at AB InBev. Local unions were initially critical of the acquisition and some South African investors expressed concerns about the deal during AB InBev’s four-week pursuit of SAB last autumn.

Since then, however, AB InBev has worked to smooth the way for South African approval by promising to guarantee jobs and by setting up a R1bn fund to support the local beer-making industry and supply chains.

The Budweiser-owner also agreed to sell SAB’s 26% stake in Distell, worth about R9.4bn, and pledged to keep its Pepsi bottling business in the country separate from the FTSE 100 company’s rival Coca-Cola operations.

Source: The Telegraph