Interesting article this morning about rumors surrounding a possible AB-Inbev and SAB-Miller merging via an AB buyout of SAB-Miller in Europe. I think that US anti-trust laws would prevent a merger of the US segments of these companies, but nevertheless, this is pretty important beer news, especially if this rumor actually goes somewhere. In typical fashion, the rumor itself helped SAB-Miller stock gain more than 5% this week. Here are a few links: http://www.brewbound.com/news/2014/press-clips-is-an-a-b-inbev-sabmiller-mega-merger-in-the-works http://www.reuters.com/article/2014/06/10/markets-britain-stocks-idUSL5N0OR4K20140610 http://www.moneyweb.co.za/moneyweb-south-africa/market-speculation-titillates-sab-investors
I know that US anti-trust laws would prevent a merger of the US segments of these companies. Why? Because if this ever went through, other US companies would want to follow suit and notwithstanding the power of lobbyists in this country, there would be too much of a shitstorm from the grassroots [I hope].
They allowed the US merger of Miller and Coors, but they are only 27% combined. They arent going to let the 45.6% company merge with the 27.0% company. 72.6%. Hmmm...question for Jesskidden...any idea the last time the total market share for BMC was that low? Im gussing early 90s. Edit: I mean literal Bud/Miller/Coors, not a generic BMC covering Stroh and Pabst and etc.
Well you never know with our politicians and public. Just look at lack of consumer interest in the proposed AT&T + DirecTV and Comcast + Time Warner mergers, and how our politicians have bowed to the wishes of Big Telecom in the Net Neutrality battles. However, back to beer, I think that the recently proposed merger between AB and Corona that failed due to anti-trust suits lends some good evidence to the fact that this would go nowhere in the US at the very least. Nonetheless, a merger between the European segments would be rather confounding (not unlike the whole MillerCoors, MolsonCoors, SAB Miller deals) in the whole scheme of things.
It didn't "Fail" - in the US, under agreement with the DoJ, ABI was forced to sell both the rights to the Grupo Modelo brands and their most modern (10m bbl capacity IIRC) brewery in Piedras Negra to the US importer, Crown - a subsidiary of the Constellation Brands. But, in Mexico and worldwide, Modelo is part of ABI. Likewise, the DoJ also made the combined AB-InBev sell off the Labatt brand in the US, as well as making the new owners of the rights to the Labatt brands (North American Breweries) not import ABI/Labatt-brewed Labatt (instead, they contract with Molson for it ). Modelo and Labatt shares of the US market at those mergers were much less that MillerCoors is, of course - around 6% and under 2%, respectively, IIRC. I'd say the primary reason the DoJ allowed SABMiller and MolsonCoors to combine their US operation into MillerCoors is that they saw it as strengthening the main competition to Anheuser-Busch - which then (pre-InBev) accounted for 50% of the US market. "Better an oligopoly than a monopoly" I guess.
Your Corona/AB example was spot on and quite telling. However, the telecom industry is more splintered. You have three types of providers - phone company, cable company, direct satellite companies. But the AT&T/DirecTV merger is troublesome since it combines two types of providers into one. But it makes sense that an InBev/SABMiller merger wouldn't be a problem in Europe. If you think of it this way, if the two largest independent beer brewers in Europe wanted to consolidate their operations in the U.S.A., do you think there would be any problem?
Yeah, this makes total sense. It'd basically be like if AB-Inbev and Heineken teamed up to consolidate sales of Heineken and Stella Artois in the US. Even so, in Europe ABI and SAB-Miller have huge holdings and tons of brands. The last major competitor there would be Heineken N.V. I don't think that Diageo (Guinness) really has much clout in the beer market over there. I have to admit I'm way out of my league on this kind of stuff. Thanks for all the good info though (especially @jesskidden)!
Yeah, probably even a bit earlier than that - mid/late 80s, when AB was still around 40% and Stroh and Heileman combined were both were around 20% market share. But, the biggest gains in that period were made by imports - gaining nearly 10% more of the total US market. Today, Crown/Modelo (#3 in the US) alone sells more beer in the US than all the imports together did in, say, 1991. And Heineken USA (with its Mexican brands) is now the #4 beer marketer in the US.
