The Australian Competition and Consumer Commission (ACCC) objects to the acquisition of the local AB InBev branch by Japanese competitor Asahi, on the grounds that free competition may be endangered.
Failed IPO
Last summer, the Japanese group Asahi acquired AB InBev’s Australian branch Carlton & United Breweries for ten billion euros. The deal came barely a week after AB InBev cancelled the IPO of its Asian branch (including CUB). In the end, the other activities were successfully listed on the stock exchange. However, it is now possible that the CUB deal will be revisited, as the Australian competition watchdog fears that free competition in the cider market will be compromised.
According to the ACCC, the proposed acquisition would bring together the two largest cider producers, who have a combined market share of around 66 % with brands like Somersby, Strongbow, Mercury and Bulmers. The acompetition authority is afraid that the deal could lead to higher cider prices“, De Tijd quotes ACCC CEO Rod Sims. Asahi is of the opinion that cider and beer belong to the same market, but the ACCC disagrees and says that apple beers constitute a separate market because cider drinkers are not necessarily beer drinkers as well.
A rejection of the Asahi deal would be a big blow to AB InBev’s finances. Since the takeover of SABMiller, the beer giant has been burdened with a huge debt, so the ten billion euros would be very welcome in the books of the Belgian beer giant. A final decision by the ACCC will most likely not be made until the end of March 2020.
