Good Beer Hunting

Sightlines — 'Megabrew' Coming? A-B InBev Approaches SABMiller to Merge

THE GIST
For years, folks inside the industry have been awaiting the eventual merger of AB-Inbev (ABI) and SABMiller. But it seems to be a bit more serious now, with ABI going on record that they have made an "approach". This has major implications for international and US-based portfolios. 

WHY IT MATTERS
The idea of the mega merger just won't go away. While such a takeover would have instant global implications, the impact here at home would be delayed because it’s unlikely the Department of Justice would approve such a clear monopoly. ABI’s 2013 purchase of Grupo Modelo met a similar fate, making it possible for Constellation Brands to acquire the U.S. distribution rights to Grupo Modelo's brands, while ABI gobbled up the rest of the international market (I spoke more in depth about that deal on Episode 7 of the GBH podcast). 

Following that model, the Miller portfolio would likely have to be divested, meaning another player would have to buy the rights to brands like High Life and Miller Lite for it to be considered legal. The bigger question for the craft drinker is what happens to brands under MillerCoors (a joint venture between the Canadian MolsonCoors and SABMiller in the US) - brands like Coors Banquet, Blue Moon, and craft acquisitions like Leinenkugel's and more recently Saint Archer, both of which could become part of ABI’s portfolio in the US.  — Nate Micklos