The deal sees the world’s largest brewer (AB InBev) and second largest brewer (SABMiller) combine into what AB InBev champions as ‘the first truly global beer company’.
At SABMiller, 95% of votes supported the offer from AB InBev: comfortably above the 75% required. The two largest shareholders, Altria and BevCo (who were treated as a separate class of shareholders and thus excluded from the vote) had already pledged their support for the merger.
Regulators around the world have already approved the deal. Certain beer brands currently owned by the combined company will be sold to meet conditions (see below for more details).
The combined company will take AB InBev’s name and see the SABMiller name disappear, with the company formally called ‘Anheuser-Busch InBev SA/NV’.
The deal was initially agreed last year: but AB InBev revised its offer in July following the Brexit vote.
New offer approved
AB InBev and SABMiller formalized the terms of AB InBev’s £71bn / $107bn offer for SABMiller (using the exchange rate of the time) in November 2015.
However, with the UK voting to leave the EU on June 23, a fall in the pound reduced the attractiveness of the November offer to SABMiller shareholders.
Therefore, AB InBev issued a revised offer for SABMiller on July 26: offering £45 in cash per share, up from the November offer of £44 per share.
The final offer values SABMiller at approximately £79bn ($103bn).
How will the beer landscape change?
In order to appease regulators, AB InBev has agreed to sell some of the combined company’s beer brands.
In the US: AB InBev will divest SABMiller’s entire US business, including its ownership interest in MillerCoors.
In Europe: AB In Bev will sell ‘practically the entire SABMiller beer business’ in the region. AB InBev agreed earlier this year to sell SABMiller brands Peroni, Grolsch and Meantime (based in Italy, the Netherlands and London respectively) to Japan’s Asahi Group Holdings. It will also sell SABMiller’s central and eastern European assets (covering Hungary, Romania, Czech Republic, Slovakia and Poland).
In South Africa: AB InBev will sell SABMiller’s stake in Distell Group Ltd.
In China: AB InBev has agreed to sell SABMiller’s 49% stake in China Resources Snow Breweries (which produces Snow, the world’s top selling beer) to China Resources Beer (China Resources Beer currently holds a 51% stake in China Resources Snow Breweries).