The ‘brandzilla’ of the beer world?
James Moore ponders the consequences of a tie-up between Anheuser-Busch InBev and SABMiller.
|||London - It's the beer blockbuster to end them all, and if it goes ahead the combination of Anheuser-Busch InBev with SABMiller (AB-SAB?) will represent a triumph of brand and bland.
The $270bn (£174bn) company that will be created if the former's takeover ambitions are realised will control nearly a third of global beer volumes. That can only grow thanks to the powerful position the giant will have in fast-growing markets - in South America and especially Africa, SAB's stomping ground.
There will undoubtedly be some disposals to satisfy the world's largely supine competition authorities. They'll want to be able to claim they're doing their jobs.
But the company created will still be a brandzilla: one whose products taste remarkably similar, whatever their name.
In more mature markets, the homogenous brews of multinationals have become decidedly déclassé, providing an opening for the micro men. Hoping to impress at a dinner party with a chilled cabernet franc from that darling little château in the Loire? It might just get trumped by a chocolate-and-chilli stout the neighbours found at the microbrewery that's just opened up down the road.
This trend is not unique to Britain, or to those parts of Europe that possess a strong tradition of independent brewing. It has also taken hold in America. Big booze businesses might pay an arm, a leg and a liver to flaunt their wares during the Superbowl, but the doyen of football journalists, Peter King, has long been highlighting the country's wealth of boutique brews at the end of his weekly Monday Morning Quarterback column to a growing band of more discerning drinkers.
This deal, though, isn't about the West. It's about emerging economic powers, and their emerging middle classes, with money to spend. It's about countries on the rise, where being seen out on the town with a brand in your hand says that you've made it.
As that middle class grows, so should this monster, if it clears the necessary hurdles, and given that a deal has been rumoured for years you can expect AB InBev's ambitious Brazilian investors will have at the very least sounded out SABMiller's dominant families.
As for the West, who cares? AB-SAB's finance chiefs will make their bonuses cutting costs in Europe and the US. It's easier to do that than invest in the creative thinking and innovation you need to produce products with the character and flavour to find favour in a variety of markets.
THE INDEPENDENT