SABMiller merger with AB InBev agreed

Anheuser-Busch InBev has agreed a takeover deal of SABMiller to create world's largest beer producer.

The owners of Budweiser and SABMiller have agreed a £71bn merger that unites the world’s two largest beer manufacturers.

AB InBev agreed to pay SABMiller £44 a share on October 13.

To make way for the takeover, SABMiller will sell its 58% share in MillerCoors to business partner MolsonCoors for around £7.9bn.

The merger now means that around a third of the worlds beer will be produced by one company, include Carling; Fosters; Budweiser; Corona; Stella Artois, and Peroni.

Shares in SABMiller jumped nearly 2% up to £40.50 per share, but that’s still less than the £44 per share AB InBev has agreed to pay.

The deal reportedly arose due to AB InBev’s desire to grow in African, Asian and Middle Eastern markets.

The new “mega brand” expects to save upwards o £900m a year by combining operations – a move that is expected to include reducing the number of staff.

AB InBev currently employs around 155,000 people, while SABMiller has around 70,000 members of staff.

The combined firms have a total revenue of $73bn, more than Google and PepsiCo.

Carlos Brito, chief executive of AB InBev, commented: “Our combination with SABMiller is about creating the first truly global beer company and bringing more choices to beer drinkers in markets outside of the US.”

The deal is expected to be completed in the second half of 2016, pending clearance from shareholders and regulators.