AB InBev is making its move toward an SABMiller takeover
After months of rumors and speculation, it may finally be happening: Anheuser-Busch InBev is making its move to acquire top competitor SABMiller. On Wednesday AB InBev issued a statement confirming that it has approached SABMiller Plc with the proposition of merging the two companies into a global beverage powerhouse. Now that the cards are on the table: what’s next?
This potential merger is only in its most nascent stage at this point, and quite far from a sure thing. AB InBev noted as much in its official statement. “There can be no certainty that this approach will result in an offer or agreement, or as to the terms of any such agreement,” the statement reads. “A further statement will be made as appropriate.”
In the meantime, the brewing company has asserted its intentions to work closely with SABMiller’s board of directors in the hopes of putting together “a recommended transaction.” But some large obstacles stand in its way, particularly the antitrust red flags that a superpower merger of this proportion would undoubtedly trigger. AB InBev’s acquisition of Grupo Modelo was only achieved with substantial divestitures, and similar legal roadblocks eventually forced top foodservice distributors Sysco and US Foods to abandon their merger attempt earlier this year.
For SABMiller Plc’s part, the company has acknowledged that AB InBev has approached them with the intent to propose an acquisition—but notes that nothing concrete has been received yet. Until that happens, SABMiller is advising its shareholders to hold off from taking any action. But at this point, AB InBev is on a deadline: the company has until October 14 by 5:00PM to make an offer.
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Mergers and acquisitions are in the air in the brewing industry right now, with even SABMiller itself acquiring San Diego craft brewery Saint Archer just last week. But by far, this would be the biggest merger yet—and between the power AB InBev and SABMiller together would hold, and the assets that other major players like Heineken could pick up as AB InBev and SABMiller are made to divest, things in the brewing industry could be getting very interesting.
Ireland could create template for global food sustainability
Leveraging innovation could cultivate new agricultural breakthroughs, making Ireland the most responsible and sustainable food producer on Earth, according to a renowned local luminary.
Economist and author David McWilliams has insisted that Ireland can become a pivotal carbon-neutral, resource-efficient and sustainable food producer – possibly the most influential on the planet.
He does acknowledge, however, that there are considerable obstacles on the country’s trailblazing journey to complete energy-efficient and sustainable food production.
McWilliams also claims that the widely-held belief within the EU that reducing food production thus reduces carbon emissions does not tally.
“For the European Union to get an aggregate reduction in carbon emissions,” said McWilliams at the Alltech ONE Ideas Conference. “It would seem to me much more logical to favour those countries that have had an evolutionary, ecological or environmental gift, in order to actually produce more, not less, because your input-output ratio is so much lower than it is either in the parched Mediterranean or in the frozen tundra of the North.”
Reflecting on the situation in the US, McWilliams said its agriculture output had tripled between 1948 and 2015, with exponential gains in efficiency. Surprisingly, agriculture only contributes to 7.5% of total US greenhouse gases, far below the 30% attributed to cars.
“I think American culture is changing, at least when you see it from the outside,” said McWilliams said of President Biden’s approach. “He's saying, ‘There's no point being wealthy if the wealth is only in the hands of a small minority. The wealth has to trickle down to everybody else.’”
McWilliams concluded that for Irish agriculture to modernise and grow, it should use one of Ireland’s leading sectors – technology – as a frame of reference. It currently generates over $25 billion in exports.