Heineken's snub to SAB revives beer deal speculation

Mon Sep 15, 2014 7:12pm EDT
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By Martinne Geller and Philip Blenkinsop

LONDON/BRUSSELS (Reuters) - SABMiller's SAB.L rejected bid for smaller brewer Heineken (HEIN.AS: Quote) has revived talk about deals that could reshape the global beer industry in coming months.

Dutch company Heineken said at the weekend that it had been approached by SABMiller about a takeover, but that it had rebuffed the approach because its controlling shareholder intended to keep it independent.

The move by SABMiller, the world's No.2 brewer by market value, is seen by many analysts as either an attempt to fend off a long-rumored takeover bid from market leader Anheuser-Busch InBev (ABI.BR: Quote) - by making itself too big to swallow - or to force its larger rival to show its hand.

"We believe SABMiller could now be considered to be 'in play' and view AB InBev as a potential acquirer," said Numis analyst Wyn Ellis.

Speculation about AB InBev's desire for SABMiller - the maker of Peroni and Grolsch - has abounded for years, since the Belgian-based company with Brazilian management made its mark with a series of astute takeovers, including the $52 billion purchase of Anheuser-Busch in 2008, and aggressive cost-cutting.

The chatter intensified in recent months and again on Monday, following a report by the Wall Street Journal that said AB InBev was talking to bankers to line up financing for a potential $122 billion bid.

One source familiar with the matter told Reuters that AB InBev was not planning a bid for SABMiller at the moment, but several other sources said they still expected a sizeable deal in the global beer industry. The sector has seen so much consolidation in recent years that at least one of the big four brewers is dominant in almost every country.

Both AB InBev and SABMiller declined to comment.   Continued...

A woman reaches for a can of Heineken at a restaurant in Bangkok July 20,2012. REUTERS/Sukree Sukplang