It's Official: AB InBev To Buy SABMiller, but not Miller

Nov. 12, 2015
Miller part of MillerCoors joint venture will be sold to MolsonCoors for $12 billion.

What's been rumored and even publicly announced for more than a month became official on Nov. 11: AB InBev made a $104 billion offer to buy SABMiller, in the process admitting it will have to sell Miller to its American joint venture partner MolsonCoors.

The makeup of the proposed new company remains a behemoth but not as large as it would have with the Miller piece intact. AB InBev would contribute $47.1 billion in sales to the merged company and SABMiller—now really the former SAB or South African Breweries—$16.5 billion in revenue.

That $63.6 billion in sales would make it the world's largest brewer—a title AB InBev already held—with sales three times that of closest rival Heineken, and holding 30 percent of global beer sales.

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. That will give AB InBev some cash and should ease regulatory approvals.

That deal includes all Miller brands and trademarks across the globe, and gives MolsonCoors—or whatever that company will be named—the right to import Peroni and Pilsner Urquell into the U.S.

Under the terms of the AB InBev-SAB agreement, SABMiller shareholders would receive GBP 44.00 (British pounds, currently about $67.50) per share in cash, with a partial share alternative available for up to 41 percent of the SABMiller shares.

The boards of the two companies already have agreed to the merger. The new company would be headquartered in Brussels, Belgium, where InBev is located.

It still must pass shareholder and regulatory approvals. Closing is expected in the second half of 2016.

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