Australia regulator raises concerns over AB InBev-Asahi deal

December 12, 2019 12:07
AB InBev's sale of its Australian unit to Japan's Asahi is facing some uncertainty as Australia's antitrust regulator has raised some concerns. Photo: Reuters

Australia's antitrust regulator has raised concerns over Anheuser-Busch InBev's US$11.3 billion deal to sell its Australian operations to Japan’s Asahi group Holdings.

The Australian Competition and Consumer Commission (ACCC), in a preliminary view, said the deal will reduce competition in the cider market and may also do so in the beer market, Reuters reports.

“The proposed acquisition would combine the two largest suppliers of cider in a highly concentrated market,” the regulator said, noting that the combined business would control about two thirds of cider sales.

The ACCC also said that Asahi may act as a competitive constraint on Australia's top beer brewers, and has “the potential to be an even bigger threat in future”.

The competition regulator said it will make a final decision in March on the AB InBev-Asahi deal, according to the report.

ACCC has invited submissions from interested parties by Jan. 22.

If the regulator decides to block the deal, it will deal a significant blow to AB InBEv which has been seeking to cut debt following its 2016 acquisition of rival SABMiller, the report noted.

AB InBev had hoped to close the sale of its Carlton & United Breweries (CUB) unit to Asahi in the first quarter of 2020 and use the bulk of the proceeds to cut debt.

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