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ACCC clears AB InBev to buy SABMiller

May 5, 2016

There will be no obstacles in the Australian market to Anheuser-Busch InBev’s proposed acquisition of SABMiller, Australia’s competition watchdog has confirmed.

Following several delays, the Australian Competition and Consumer Commission on Thursday announced it will not oppose the deal dubbed ‘Megabrew’.

“The ACCC has concluded that the proposed acquisition is not likely to substantially lessen competition in the Australian beer market,” ACCC chairman Rod Sims said.

“The ACCC found that the proposed acquisition would not significantly change the current market structure.

“The two largest suppliers of beer in Australia are Lion and SABMiller, which owns Carlton & United Breweries (CUB).

“While AB InBev’s brands have been successful in Australia, particularly Corona, they have previously been distributed via either Lion or CUB. AB InBev has only a limited direct company presence in Australia and does not brew beer here.

“The ACCC considers that the proposed acquisition is unlikely to result in higher beer prices for consumers,” Sims said.

AB InBev and Lion to sever ties
The ACCC said it was crucial to its decision that AB InBev has already served notices to terminate agreements with Lion for the distribution of Corona and other AB InBev brands in Australia, subject to certain notice periods.

“The ACCC had been concerned that, if these distribution agreements continued, the proposed acquisition may have increased the ability and incentive for coordination between Lion and AB InBev/SABMiller,” the watchdog said.

“After the termination of these distribution agreements, the relevant beer brands will in future be distributed in Australia by AB InBev/SABMiller.”

ACCC chairman Rod Sims said the termination of the distribution arrangements had therefore resolved the ACCC’s competition concerns.

Read more:
Megabrew and buyouts demand unity among small brewers, CBC 2016 hears

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