Anheuser-Busch InBev Rumored to have Sights Set on SAB Miller Acquisition

It looks like Anheuser-Busch InBev will not be happy until they have total global beer domination. The beer community is abuzz and aghast at this latest development. Anheuser-Busch InBev, fresh off of the acquisition of Chicago craft brewer Goose Island is looking to increase its portfolio or breweries. It seems like the brewer has no plans so slow down. Analyst feel strongly that Anheuser-Busch InBev is looking to acquire SABMiller. noted: Analysts attribute SABMiller’s strong share price to speculation that the second-largest brewer may be a takeover target of the largest. “There is undoubtedly some underlying speculation that Anheuser-Busch InBev will make an offer for SABMiller,” UK-based Sanford C Bernstein European beverages analyst Trevor Sterling said. “The stock is fairly valued, though it may be a little expensive compared to its peers. There is definitely a bid premium in the stock.”

Lew Bryson has a great post on his blog today in regards to this development. Lew feels the US government will never let someone control 2/3 of the global beer markets. I am not a scholar on international trade law but seeing InBev is a Belgium company and SAB Miller is South African owned, I don’t know the U.S. has much say in the merger. I could be wrong.

Lew Bryson blogged: Is the consolidation of big brewers going to reduce itself to absurdity? Speculation continues to strengthen that Anheuser-Busch InBev is going to make a bid for SABMiller. Leaving anti-monopoly issues out of it for the moment — since, well, really: does anyone actually think the U.S. government is going to do anything about one company controlling 2/3+ of the beer market? Of course not; return to work, cogs — let’s think about this.

ABIB has the means to do the deal; they’ve been slashing costs and raising prices (even though their volume in their most lucrative market — the U.S. — is still dropping, they’re making more money (not a great long-term state, how long can that go on, eh?)) and the debt from the purchase of A-B is either paid off or close to it; they’ve got a substantial warchest of almost $5 billion in cash/equivalents that will make a good start towards financing another acquisition.

I am guessing no brewer is safe from the grips of Anheuser-Busch InBev. They will most likely continue to gobble up their competition until there is nothing left but nano-breweries like Boston’s Nightshift Brewing to acquire. After that they are coming after your homebrew pot.