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InBev takes over Anheuser-Busch, forms global brewer
Our Bureau
Date of posting: 14-07-08
      After weeks of discussions and revised offers, InBev and Anheuser-Busch have on Sunday announced an agreement to combine the two companies, thus forming the world's leading global brewer. Both companies' Boards of Directors have unanimously approved the transaction, InBev said in a release.

       The combined company will be called Anheuser-Busch InBev and will be under the leadership of InBev’s CEO Carlos Brito. Brito named the deal a “historic transaction”.

      According to the deal, Anheuser-Busch shareholders will receive $70 per share in cash. The earlier bid by InBev of $65 per share was regarded as to small by Anheuser-Busch. The total transaction price has a huge size of $52 billion (€32.7).

      The combination of Anheuser-Busch and InBev will create the global leader in the beer industry and one of the world's top five consumer products companies. On a pro-forma basis for 2007, the combined company would have generated global volumes of 460 million hectoliters, revenues of $36.4 billion (€26.6 billion) and an EBITDA of $10.7 billion (€7.8 billion), InBev said. Second largest beer giant SABMiller had a volume of Miller 239 million hectoliters in 2007.

      The companies expect cost synergies of at least $1.5 billion annually by 2011 and revenue enhancement. Synergies should be reached through sharing best practices, economies of scale and rationalization of overlapping corporate functions. Additional revenues should be reached through the expansion of Budweiser with the help of InBev which would be the number one brewer in 10 markets where Budweiser has a very limited presence, and which would have a superior footprint in nine markets where Budweiser is already present.

      “This combination will create a stronger, more competitive global company with an unrivaled worldwide brand portfolio and distribution network, with great potential for growth all over the world”, Brito said.

      Both companies together own approximately 300 brands around the world, like Stella Artois, Beck’s and Löwenbräu. Budweiser, the leading brand of Anheuser-Busch and market leader in the US, was declared to be the “flagship brand” by the new company.

      The expanded company will have leading positions in the world's top five markets China, U.S., Russia, Brazil and Germany.

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