MOFCOM gave the nod for merger of InBev and AB
Last week, China’s Ministry of Commerce (MOFCOM) agreed with Belgium brewer Inbev’s $52 billion take over of Anheuser-Busch Cos Inc (AB). But the two parties are not allowed to increase their ownership stakes in domestic beer companies without approval from the ministry.
According to a ministry spokesperson, since China’s Anti-Monopoly Law took effect in August, this is the first acquisition deal that has passed MOFCOM under the law.
Based on the conclusion of MOFCOM, the merger of the two companies would not restrict competition in the domestic beer market.
However, in order to keep a competitive environment, the ministry also prescribed that without its approval, AB and Inbev could not raise their share in Tsingtao Beer and Zhujiang Brewery Group separately.
What is more, the ministry does not allow the two parties to acquire shares in CR Snow or Beijing Yanjing Brewery which are two of the largest domestic brewers, according to the statement.
A research analyst with Euromonitor International Huang Qiong said that the conditional approval of the acquisition deal is to support fair competition in China’s beer market and to protect major domestic brands.
The market research shows that up to now, Inbev and AB jointly have taken 13% share of China’s beer market.
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