Anheuser-Busch InBev Aggrees To Buy SABMiller In $106 Billion Deal

The cash part of the deal will be financed by AB InBev from existing resources and a few third party debt. By purchasing SABMiller’s stake, Molson Coors will gain full control of the operations, and retain the rights to all the brands in MillerCoors U.S. portfolio.

“We believe this combination will generate significant growth opportunities and create enhanced value to the benefit of all stakeholders”, said AB InBev CEO Carlos Brito in a statement.

The deal, if approved, would effectively double the Denver-based brewing company’s business.

Chief executive Alan Clark said: “We had a good first half, stripping out the effects of adverse exchange rates, with strong growth in Africa and Latin America and better mix across all of our regions”.

AB InBev’s proposal to take over SABMiller was agreed in principle on October 13. Since then, they had been negotiating the details of the merger.

Once the deal is finalized, which is expected to happen in the coming months, Labatt will have a bigger stake in both the growing pre-mixed drinks and ciders markets, which have been growing in popularity.

SABMiller’s board of directors is recommending that shareholders accept the deal. While it may be now controlling 20.8% of the world’s beer in 2014, AbInBev has been missing a foothold in emerging markets, particularly on the African continent, where South African-born SABMiller has a presence in 38 countries.

Image: SABMiller and Anheuser-Busch InBev reach final agreement.

Richmond-based Altria Group said Wednesday it supports Anheuser-Busch InBev’s plans to buy SABMiller plc for $107 billion.

The merged entity would have annual sales of $73.3bn, making it three times more than competitor Heineken, reported The Associated Press. The company is listed in Brussels and NY.

The announcement said MolsonCoors has agreed to pay $12 billion in cash for SABMiller’s 50 percent voting interest and 58 percent economic interest in the MillerCoors joint venture. The move is aimed at appeasing regulators, and would make Molson Coors the second-largest brewer in the U.S. That partnership owns several major brands in the United States, including Miller Lite, Coors Light and Blue Moon.