With Anheuser-Busch focusing on cost cutting, SABMiller could mount a challenge to the brewer's dominance in the US.
The InBev takeover could result in “significant disruption” of Anheuser's operations, SABMiller said yesterday. Anheuser is MillerCoors' biggest competitor in the US.
Anheuser accepted a takeover offer of $52bn from InBev, a 27% premium to Anheuser's highest share price in October 2002, to create the world's largest beer maker and end a month-long standoff.
SABMiller said it would be a challenge for InBev to extract $1,5bn of cost savings from Anheuser-Busch.
The deal sees InBev regain the top world brewing position it lost to SABMiller last year with the London-based group's strong growth in China and its Grolsch acquisition.
In October, SABMiller and Molsen Coors told of a multibillion-dollar joint venture to combine US operations and boost their competitive position against Anheuser. MillerCoors expected to get 30% of the US market.
Imara SP Reid analyst Warwick Lucas said Anheuser held more than 50% of the US beer market. With such a dominant position, the chances of it growing market share were slim, so it had little option but to cut costs.
“This deal is good news for SABMiller” in the US, Lucas said.
Source: Business Day
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