Busch-Miller Beer Merger|Would Be Biggest Ever

ST. LOUIS (CN) - In a move sure to attract antitrust scrutiny, Anheuser-Busch InBev and SABMiller said Wednesday they will combine to form the world's largest beer brewer: a $108 billion merger.

It will be the largest beer mergers in history and one of the largest global mergers ever, if shareholders and antitrust regulators approve. Completing the process is expected to take nearly a year.

The merger will combine Anheuser-Busch InBev's Budwesier, Bud Light and Stella Artois brands with SABMiller's line that includes Peroni and Foster's. The new company is expected to generate 30 percent of the world's beer sales.

A-B InBev CEO Carlo Brito said the beer giant expects to realize $1.4 billion in annual cost-savings after combining the companies in a four-year process. The savings are expected to come through procurement, sharing best practices, improving brewery efficiency and reducing costs by combining corporate offices and overlapping regional headquarters.

Brito, during a conference call with reporters, said it will be business as usual in the United States for A-B InBev, which maintains its domestic headquarters in St. Louis.

"The synergies are outside of the U.S.," Brito said in the call. "Our business in the U.S. does not change."

To satisfy U.S. antitrust concerns, SABMiller will sell its 58 percent stake in Chicago-based MillerCoors. That $12 billion sale means Miller Lite and other Miller brands will not be owned by the same company as Bud Light and Budweiser.

As part of the deal, SABMiller also agreed to sell Miller's international business to MolsonCoors. It also will give MolsonCoors U.S. rights to sell SABMiller foreign brands now in the MillerCoors portfolio, such as Peroni and Pilsner Urquell.

Satisfying Chinese regulators might be another hurdle. Industry experts say the new company may have to divest SABMiller's 49 percent stake in CR Snow, China's leading brewer.

Follow @@joeharris_stl

Subscribe to Closing Arguments

Sign up for new weekly newsletter Closing Arguments to get the latest about ongoing trials, major litigation and hot cases and rulings in courthouses around the U.S. and the world.

Email *

Submit