London (AFP) – Belgian-Brazilian brewer AB InBev savoured its status as the global leader in the beer industry after investors approved Wednesday its buyout of British rival SABMiller.
Shareholders in SABMiller — currently the producer of Foster’s, Grolsch and Peroni lagers — overwhelmingly approved $103-billion (92-billion-euro) takeover from the maker of Budweiser, Corona and Stella Artois.
The announcement came hours after AB InBev investors also backed the fourth largest merger in global corporate history that tops a decade of consolidation in the world’s beer sector.
The new company will be called AB InBev, sounding the death knell of the SABMiller name whose chequered history dates back to the late nineteenth century, while its headquarters will be in Belgium.
The blockbuster deal — nicknamed Megabrew by analysts — cements AB InBev’s dominant position as the world’s top beer-maker.
“The Megabrew deal between AB InBev and SAB Miller has been overwhelmingly approved,” said David Cheetham at London-based brokerage XTB.
“There’s clear synergies to be achieved through this merger and the new company will see the combined group account for one in four beers sold worldwide,” he told AFP.
“AB InBev was already the largest brewer globally, and if the deal goes through in the coming weeks as is expected, the firm can look forward to laying claim to almost half of the industry’s profits.”
Anna Ward, alcoholic drinks analyst at London-based consultancy Euromonitor International, described the deal as “the culmination of over a decade of consolidation within the beer industry”.
She added: “With an estimated 27-percent share of the beer market and a significant presence in all regions, the combined company will be genuinely global.
Ward also noted that SABMiller’s strength in the emerging markets of Africa addressed a previous weakness in AB InBev’s profile, while the merger will make it easier to roll out flagship beers in areas not yet reached.
“In light of the slowdown in key markets such as Brazil, extending the reach of its flagship global brands will undoubtedly remain a priority for AB InBev.”
The blockbuster deal is now set for completion on October 10.
“AB InBev shareholders expressed their support for the combination by passing all resolutions that were proposed in connection with the combination,” a short statement from the Belgium-based brewer said on Wednesday.
SABMiller added separately that “resolutions proposed in connection with the recommended acquisition by Anheuser-Busch InBev … were passed” by its investors.
Back in July, AB InBev raised its offer for SABMiller to £45 a share from £44, after sterling slumped following Britain’s Brexit vote to leave the European Union.
The improved offer valued the London-headquartered SABMiller at the equivalent of £79 billion. InBev, based in Leuven in Belgium, had agreed in November last year to buy SABMiller.
The deal is expected to boost AB InBev’s prospects in developing markets in Africa and China, where a SABMiller joint venture produces Snow — the world’s best selling beer by volume.
To win EU approval, AB InBev has agreed to a long series of concessions, including the sale of SABMiller’s Peroni, Grolsch and Meantime brands to Japanese rival Asahi.
The EU also demanded the brewer also divest SABMiller’s business in the Czech Republic, Hungary, Poland, Romania and Slovakia.
AB InBev has already indicated that it will cut around 5,500 jobs after it completes the takeover, slashing about three percent of its enlarged staff over three years following the tie-up.
SABMiller employs about 70,000 employees in more than 80 countries, while AB InBev has about 150,000 staff in 26 countries, according to company figures.
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