The Crown drink Peroni: a toast to 90 billion Euros – The Republic

Milan – The merger will. After a long courtship weeks SabMiller said yes. It ‘was therefore reached an agreement for the mega-merger in beer after the world number one, the Belgian-Brazilian InBev Ab has come to bring to the table over 90 billion euro, about 68 billion pounds. Quite why South Africans (under which the hat there are – among others – the brands Peroni Nastro Azzurro and Pilsner Urquell) accept the tender offer of the industry leaders, the Belgian-Brazilian Ab Inbev (owns over 200 brands including Budweiser, Corona and Stella Artois). This is a major acquisition operations of history: the previous record in British history it was for the merger by 47 billion pounds between British Gas and Royal Dutch Shell this year.

Ab Inbev had left with 38 pounds, then raise to 40, raised to 42.15 and finally to 43.5 to end at a value which represents a premium of approximately 50% compared to the closing price of SabMiller September 14, before the spreading of rumors on takeover bids. After years of speculation, the deal has been accelerated by the impact of the economic slowdown in emerging markets, especially China and Brazil. The mega-merger will give activity to a group with a market capitalization ‘monster’ of more than 250 billion euro that will produce one third of the beer world and will operate in all major markets by opening the doors of Africa to the Belgian group. The two largest shareholders of Sabmiller, Altria group and Bevco (who hold 41% stake) may choose from the offer cash or a mixed offer in cash and shares: 0.48 shares for each share Ab Inbev and 3.78 pounds in cash.

In the past, to defend against a possible attack, the South Africans had tried, unsuccessfully, to detect Heineken, but the Dutch family that controls the group responded spades. The move was read by all analysts as an attempt to defend itself from potential takeover of Belgian rival. Buying Heineken, SabMiller would add more than 25 billion dollars to its sales and strengthened its presence in emerging markets, including Africa and Mexico. On the other hand in the last 20 years, the group has climbed the market and, to the sound of acquisitions, the Colombian Bavaria the Australian Foster’s in 2011, has developed from simple brewer South Africa to world number two. Enough to get into the viewfinder of the giant Belgian who dreams the birth of a giant capable of carrying nearly half of the profits of the beer in the world. Because while SabMiller grew Ab InBev was certainly not to look: in the last decade has invested $ 100 billion to make raid of manufacturers around the world from Corona to Budweiser.

“We believe that the combination of the two companies would build the first batch of beer truly global, “said Carlos Brito, CEO of InBev. Together Ab Inbev SabMiller and give birth to a giant 64 billion in revenues and an EBITDA of 24 billion dollars. The Public Investment Corp, a pension fund of state of South Africa, has however expressed negatively with respect to the takeover that would harm consumers and potentially deprive the title of SabMiller from the Johannesburg Stock Exchange. SabMiller has meanwhile announced that net revenues for producers (npr) rose by 6% on year in the second quarter at constant exchange rates, driven by Africa and Latin America. In the first half of the year they increased by 4%. But at current exchange rates, fell by 9% in both periods due to the depreciation of the currencies of reference against the dollar.

The last word on the future of the new giant will be up to the various local competition authorities that may impose the sale of different brands in different countries from the US to China: on the other hand the new group will be market leader (first or second) in 24 of the 30 largest markets in the world. According to analysts, however, the Belgians would be ready to sacrifice the American brand of Coors SabMiller.

Arguments:

SabMiller

AB InBev

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