A beer behemoth may have just been born.
British brewer SABMiller — whose brands include Foster’s, Miller and Peroni — finally accepted a $106 billion offer from beer giant Anheuser-Busch InBev on Tuesday. If approved by regulators, the move would create the world’s biggest beer company, and would also bring Budweiser and Miller Genuine Draft, two top U.S. brands, together.
It’s potentially disastrous news for craft beer drinkers.
As it is, AB InBev is enormous. The company owns such popular brands as Budweiser, Beck’s and Corona. But more U.S. drinkers are ordering craft beer. Craft brewers produced 22.2 million barrels in 2014, an 18 percent rise in volume over the previous year, according to the Brewers Association trade group.
AB InBev has taken note, aggressively buying up craft breweries in recent years. In 2011, the company bought Chicago-based Goose Island Beer Company. Last year, AB InBev added Blue Point Brewing Company, based on Long Island, to its roster.
But the the real problem is the company’s distribution power.
The U.S. Justice Department is investigating AB InBev for allegedly attempting to winnow down the craft beer market. The company bought up five distributors in three states over the last few months, stoking fears that it would keep beers from independent breweries off the shelves it now controls.
“[The distributor] is slowly but surely divesting itself of everything that is not AB [InBev]. And we’re one of the last ones,” a craft brewery executive recently told Reuters. “We’re at the mercy of a lot of big players.”
If the foam settles on this deal, the two biggest of those players will become one Goliath.
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