World's largest brewer AB InBev to focus on beer acquisitions

AB InBev world’s largest brewer shared that their future acquisition are mostly possible in beer rather than branching out into other beverages.

According to the analysts and investors, the brewer giant which is set to buy its rival SABMiller looks at spirits company Diageo, unlisted French wine and beer group Castel, which has a large African presence, and Coca-Cola as the new target, reported PTI.

"We've always done it within beer. We don't believe in going too much outside beer. That makes the likelihood of success in integration higher," shared Carlos Brito, CEO, AB InBev in the company's annual meeting.

AB InBev, which makes Budweiser, Stella Artois and Corona, expects to seal its $100 billion-plus acquisition of SABMiller in the second half of the year.

Speculation about AB InBev's next move has been strengthened by a six million share option plan for some 65 senior managers, below the executive board, which would be granted if the company's revenue hit $100 billion in 2020, 2021 or 2022.

AB InBev's revenue last year was $43.6 billion. With SABMiller, that would be a pro-forma of $55-60 billion, including disposals, leaving a 70-80 percent hike required in a maximum of seven years.

Without further acquisitions, this would be a giant leap, particularly with currency weakness versus the dollar making any expansion this year hard to achieve.

Furthermore, with the creation of InBev in 2004 and its purchase of Anheuser-Busch in 2008, of the rest of Mexico's Modelo in 2012-2013 and SABMiller now, it has shown it tends to get the major merger bug every four years.