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Brazil
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A new transnational brewer is born with
the Merger of AmBev and Interbrew
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If the talks being held in secrecy by AmBev of Brazil and
Interbrew of Belgium are confirmed, the creation of one of
the major brewers of the world and the major private
transnational of Brazil is likely to be announced one of
these days, perhaps on Wednesday 3. The new company would
have annual sales of US $ 10 billion and might be in a
position to compete at global level with US based
Anheuser-Busch,
so far the indisputable global leader of the sector.
At the beginning, the new combined company
AmBev and
Interbrew
would be
split, to merge then in a second stage.
According to projections by the international consulting
firm Canadean, based on 2002 data of
AmBev and
Interbrew,
this
giant company would control more than 11 percent of the beer
market.
Anheuser-Busch,
manufacturer of Budweiser beer, accounts for 12.1 percent of
the world beer production.
Brazilian and Belgian capitals shall have equal stake in the
new company even though Interbrew is larger than
Ambev, both in market value and in volume of production
(however the Brazilian company is more "efficient” than
Interbrew its operating margin is 22.5 percent, while that
of its new partner is hardly 12 percent.)
The South American brewery has a leading position in the
region and it also operates in Central America, while the
Belgian brewer has major interests in Europe (essentially in
Germany, Belgium, Russia and the Czech Republic), North
America (Canada is its strong point) and the Asian market.
In Mexico, the Belgian company has a 30 percent stake in
Femsa, which trades the brands Tecate and Sol. As regards
AmBev, during the past four years it acquired almost ten
breweries in different Latin American countries, a region
where Interbrew has no plants of its own.
While Citibank and the law firm Barbosa, Müssnich & Arago
are the legal advisers of AmBev, the European company takes
legal advice from Goldman Sachs and the law firm Machado,
Meyer, Sendacz & Opice.
The merger operation was approved by high-level
representatives of the Brazilian government, such as the
Minister for Home Affairs (Casa Civil), José Dirceu, and the
Minister of Finance, Antonio Palocci, who were informed
about the talks in December.
Once the possibility of a merger with Interbrew was
known by the public, the price of AmBev’s shares rose
sharply in the Sao Paulo Stock Exchange and reached its
highest value.
Daniel Gatti
© Rel-UITA
1 March, 2004
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