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The hurdles that await Megabrew

by , 15 October 2015

SABMiller and Anheuser Busch InBev have nearly two weeks to iron out the details for their deal.

For the deal to get the go ahead, they need to gain regulatory approval from all the markets they operate in.

Already, Australian regulators are likely to raise issues about the deal. And then there's the issue about the name ‘Megabrew' will take.

Let's take a closer look at what's going on…

Megabrew could face problems in Australia

The deal between SABMiller and AB InBev is likely to lead Australian regulators “to raise concerns,” reports MoneyWeb. The resulting company would “control around 46% of Australasia’s two billion litre beer market”.

According to Allan Fels, who was previously a chairman on the Australian Competition and Consumer Commission, the body is “wary of deals where the top three players are cut to two,” adds MoneyWeb. This is due to concerns about there being enough competition.

Then there is another potential problem closer to home.

In Africa, “SABMiller is a key Coke bottler,” notes BDLive. But the deal would result in AB InBev becoming SABMiller’s parent, which is “a key PepsiCo soda bottler in Latin America”.

So there is a potential conflict of interest between the two largest cola rivals, adds BDLive. And there is also rumour that AB InBev has Coke in its future acquisition sights.

What will Megabrew be called if the deal goes through?

Whilst much of the financial press have named the merged company Megabrew, if the deal is a success, what will the company be called?

Both SABMiller and AB InBev’s current names are a result of mergers and acquisitions, says Fin24. But a name change is likely so not to upset one side of the deal.

Names so far include “SAB InBev, ABSAB, Globev, SABI and Omnibrew,” adds Fin24. Other names produced from Popnamer.com, an online forum, include Hopportunity, Beerhemouth and MegaKega.

Time will tell if the deal gains the necessary regulatory nods of approval. Once this happens, the new company may reveal a new name.

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The hurdles that await Megabrew
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