Ahead of the completion of its takeover of SABMiller, Anheuser-Busch InBev has agreed to sell the FTSE 100 company’s stake in the world’s largest beer brand for $1.6bn.
However, the deal still needs regulatory approval. That likely would have alarmed Chinese antitrust regulators.
The company said Wednesday it would buy the 49% stake it doesn’t already own in CR Snow, China’s largest brewer by volume, for $1.6 billion from SABMiller.
Anheuser-Busch InBev is nearing a deal for the sale of SABMiller’s Chinese beer business to China Resources Beer Holdings, the Wall Street Journal reported, citing sources familiar with the matter. Another analyst with Guotai Junan Securities Song Tao, “After the acquisition deal between AB InBev and SABMiller, their market share in China would have exceeded 40%”. The Snow Breweries venture, set up in 1994, has a market share of around 24 percent in China and operates 98 plants across the country according to SABMiller, which describes the venture’s “Snow” product as the world’s biggest beer brand.
China Resources Snow Breweries had a net asset value of HKUS$27.2 billion (US$3.5 billion) at the end of past year, the statement said. The transaction will give China Resources Beer full ownership of CR Snow, which commands around 30% of China’s market.
AB InBev, which makes Budweiser and Corona among other brands, says the sale is part of an effort to “proactively address regulatory considerations”, surrounding its merger with SABMiller.
The Chinese brewer previous year made a decision to focus on beer by exiting its retail and food businesses.