Mergers and Acquisitions by Anheuser-Busch InBev

Abstract

In the year 2004, Interbrew and Ambey merged to create the world’s largest brewer InBey. In 2008, the merger of InBev and Anheuser-Busch was completed. The combination resulted in the creation of one of the top five consumer product companies in the world. Under the terms of the merger agreement, all shares of Anheuser-Busch were acquired for 70 US dollar per share in cash for an aggregate of US$52 billion. The combined company was named as Anheuser-Busch InBev. The combination was expected to result in cost synergies of at least $1.5 billion annually by 2011. During the year 2016, Anheuser-Busch InBev completed the acquisition of SABMiller for £69 billion (US $107 billion). By January 2017, the combined company had approximately 500 beer brands in 50 countries. The merger resulted in the combined firm having operations in virtually all the major beer market and portfolio consisting of global, multicountry, and local brands. Through the merger with SABMiller, AB InBev was able to have a strong presence in key emerging markets like Africa and Latin America. The $100 billion merger between AB InBev and SABMiller was termed as the third largest acquisition in history and the largest ever in Britain. The merger resulted in an industry giant which accounted for 30% of the global beer sales. The merger with SABMiller was expected to yield $1.4 billion annual savings for AB InBev in 4-year time at a one off cost of $900 million. The cumulative returns for AB InBev during the 510-day window period −5 to +504 day were 11.8% during SABMiller merger.