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Ab InBev Internationalisation Strategy

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Overview of the general strategy of the world's largest brewer and focus on China and Afrika for new growth perspectives.

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Ab InBev Internationalisation Strategy

  1. 1. International Business Strategy AB InBev Boogaard Sylvain Epple Isabel Gauthier Raoul Rostenne Simon Steyaert Morgane !
  2. 2. 2 ! ! ASIA AFRICA Forthcoming Internationalization Challenges Assessment of Past Internationalization Strategy Industry Analysis Merger & Acquisition: (External Growth) Number one brewer and in the top five Fast Moving Consumer Goods firms Megamerger between AB InBev and SABMiller with direct impact on the internationalization strategy, particularly in China and Africa. Established since 1366 Interbrew and Ambev merged in 2004 Acquisition of Grupo Modelo in 2012 2008 merger with Anheuser-Busch 2016 Acquisition SABMiller TODAY Raising interest for substitutes (wines, ciders, non-alcoholic beverages, …) Highly concentrated competition as top 10 companies are representing 65% of the market share in 2013. Fast entrance High risk Synergies Wholly owned Difficulty of the deal Increase debt ratio “Think Global, Act Local” The portfolio is separated in categories such as international, multi-country and local brands to appeal to a larger number of potential customers. The Chinese market is expected to provide 31% of the world volume growth in the next ten years. Premiumization à Increase the share of the winners into the Tier-1 cities. à Strengthen the position of their crafted beers Expansion province by province à Merger with local/regional lager beers companies à Africa’s beer volume is expected to grow by 44% between 2014 and 2025. à The African customer is used to lager types of beers so this choice seems to be the best strategy on a short term à The forthcoming raising middle class should also be anticipated
  3. 3. 3 ! 0. INTRODUCTION 4 1. INDUSTRY, COMPANY AND STRATEGY OVERVIEW AND MAIN GLOBALIZATION DRIVERS 4 2. ASSESSMENT OF PAST INTERNATIONALIZATION STRATEGIES OF AB-INBEV 9 2.1. AB INBEV’S MAIN PILLARS FOR A SUCCESSFUL INTEGRATION 9 2.2. MERGERS AND ACQUISITIONS 9 2.2.1. INTERBREW AND AMBEV 9 2.2.2. ANHEUSER-BUSCH AND INBEV 10 2.2.3. ACQUISITION OF GRUPO MODELO 10 2.2.4. ACQUISITION OF SABMILLER 11 2.3. INTERNATIONALISATION STRATEGY 12 2.3.1. COMPARISON OF AB INBEV WITH ITS CLOSEST COMPETITOR: HEINEKEN 13 3. INTERNATIONALIZATION STRATEGY RECOMMENDATIONS 15 4. CONCLUSION 21 5. BIBLIOGRAPHY 22 6. APPENDIX 25 6.1. 10 PRINCIPLES 25 6.2. WORLD BEER INDUSTRY (% OF VOLUME, 2014) 26 6.3. CONSUMER’S CLASSES EVOLUTION FORCASTS 26 6.4. CONSUMPTION PER CAPITA (20 LARGEST PROVINCES IN TERM OF LITERS OF BEER) 27 6.5. SEGMENT COMPARISON 27 6.6. CONSUMPTION VS GDP (PER CAPITA, THOUSAND OF USD AND LITERS) 28 ! !
  4. 4. 4 0. INTRODUCTION! ! A! beer! is! usually! something! one! enjoys! with! some! friends! sitting! at! a! table! on! a! sunny! day,! not! thinking!about!the!massive!corporate!world!behind!it.!However,!the!Belgian?based!AB!InBev!became! the!world’s!first!global!brewer!following!its!numerous!mergers!and!acquisitions.!This!applies!even! more!since!October!2016!when!AB!InBev!concluded!a!deal!with!SABMiller,!its!closest!competitor!at! this! time! in! terms! of! size,! resulting! in! one! of! the! biggest! acquisition! in! the! corporate! history.! Of! course,!due!to!complicated!legislations!and!rules!on!unfair!competition,!AB!InBev!had!to!make!some! important!strategic!choices!about!its!business!units!and!brand!portfolio.!For!merging!purposes,!the! industry! leader! had! to! divest! some! of! its! units! to! competitors! and! thus! make! essential! portfolio! choices!on!international!business!matters.!! ! In! this! paper,! we! will! first! discuss! the! industry,! the! company! and! the! strategy! overview! before! moving!to!AB!InBev’s!history!in!terms!of!strategy,!past!mergers!and!acquisitions!and!performance.! We!will!then!compare!the!company!to!one!of!its!largest!competitor!on!the!global!market:!Heineken.! Finally,!we!will!analyze!the!forthcoming!opportunities!that!AB!InBev!will!have!to!take!in!order!to! ensure!a!stable!growth,!mostly!in!Asia!and!Africa.!Indeed,!those!two!regions!are!part!of!the!motives! behind!the!acquisition!of!SABMiller.!Did!AB!InBev!really!redefine!its!global!strategy!by!making!this! decision?!Are!Asia!and!Africa!really!the!future!of!the!beer!industry?!What!about!their!decision!to!sell! some!important!business!units!owned!by!its!acquired!units?! 1. INDUSTRY, COMPANY AND STRATEGY OVERVIEW AND MAIN GLOBALIZATION DRIVERS ! 1.1. Industry overview AB! InBev,! world’s! number! one! brewer,! is! part! of! the! five! biggest! Fast! Moving! Consumer! Goods! companies!of!the!world,!after!Nestlé,!Procter!&!Gamble,!PepsiCo!and!Unilever!in!terms!of!revenue.! In!terms!of!EBITDA1 !however,!the!Belgian!company!AB!InBev!reaches!the!second!highest!level.!The! recently! announced! merger! between! the! two! biggest! brewers! AB! InBev! and! SABMiller! will! undeniably!catapult!the!company!at!the!first!position.!! 1 !Excluding!synergies! 2 !Bjornstad!et!al.!(2011).!Beer!Industry.!Retrieved!on!April!4,!2017,!from!https://fr.slideshare.net/cadeler/beer?industry!
  5. 5. 5 Figure 1. AB InBev Merger with SABMiller creates one of the world’s leading Consumer Goods Companies (USD in billions) Investor!Presentation!(2015).!Building!the!first!truly!global!beer!company.!Retrieved!April!7!2017!from! http://www.abinbev.com/content/dam/universaltemplate/abinbev/pdf/investors/quaterly? reports/2016/ABInBev_Full_Year_2015_Investor_Presentationt_External.pdf! Over! the! years,! AB! InBev! has! acquired! number! one! or! number! two! positions! in! 192 ! important! markets,!overpowering!its!main!competitors!that!are!Heineken!and!Carlsberg!since!the!merger!of! the!two!giants,!AB!InBev!and!SABMiller.!Talking!of!which,!the!beer!industry!is!mainly!characterized! by! a! consolidation! trend,! partly! motivated! by! the! development! of! economies! of! scale,! market! penetration!and!the!increase!of!product!portfolio.!The!latter!is!important!as!the!industry!is!achieving! maturity,!meaning!that!actors!have!no!other!choice!than!to!invest!in!R&D!to!gain!market!share.!! ! Table 1. Evolution of the turnover in the beer industry in 2013 ! 2011! 2012! 2013! 20143 ! 20154 ! Industry! turnover!(in! billion! dollars)! 500,24! 505,!74! 511,30! 516,!92! 522,60! Source:!Calmé,!I.,!&!Polge,!M.!(2015).!11!cas!de!stratégie:!études!de!cas!d'entreprises!avec!corrigés!détaillés.!Paris:!Dunod!! ! An! alternative! however! indicates! a! strong! focus! on! emerging! markets! that! show! higher! growth! potential!than!developed!markets.!In!2013,!10!companies!shared!65%5 !market!share,!with!AB!InBev! leading!the!way.!AB!InBev,!SABMiller,!Heineken!and!Carlsberg!possess!45%6 !market!share,!leading!to! the!conclusion!that!the!market!is!highly!concentrated.!! ! ! 2 !Bjornstad!et!al.!(2011).!Beer!Industry.!Retrieved!on!April!4,!2017,!from!https://fr.slideshare.net/cadeler/beer?industry! 3 !Estimation! 4 !Estimation! 5 !Calmé,!I.,!&!Polge,!M.!(2015).!11!cas!de!stratégie:!études!de!cas!d'entreprises!avec!corrigés!détaillés.!Paris:!Dunod.! 6 !Ibid!
  6. 6. 6 Table 2: Main brewer’s repartition by geographic area in 2013 ! AB!InBev! SABMiller! Heineken! Carlsberg! Asia!Pacific! 7.8%! 1.1%! 0.9%! 2.0%! Eastern!Europe! 16.5%! 15.1%! 16.7%! 24.8%! Latin!America! 34.7%! 11.5%! 0.5%! 0.1%! MiddleHEast!and! Africa! 0.6%! 38.8%! 18.1%! 1.1%! Western!Europe! 10.6%! 3.5%! 17.3%! 11.2%! North!America! 50.0%! 16.1%! 2.9%! 0.1%! Australia! 1.2%! 3.5%! 17.3%! 11.2%! Source:!Calmé,!I.,!&!Polge,!M.!(2015).!11!cas!de!stratégie:!études!de!cas!d'entreprises!avec!corrigés!détaillés.!Paris:!Dunod! ! In!light!of!the!analysis!of!the!industry,!Porter’s!Five!Forces!helps!getting!a!better!overview!of!the! industry’s!competition!from!AB!InBev’s!position.! ! ! Figure 2. AB InBev Porter’s Five Forces Analysis ! 1.2. Company overview Established!since!1366,!the!Belgian!company!AB!InBev!has!made!a!name!to!itself!after!a!series!of! mergers! and! acquisitions.! Of! these,! there! are! four! important! combinations.! First,! Interbrew! and! Ambev! merged! in! 2004,! resulting! in! InBev.! Second,! the! newly! named! company! merged! with! Anheuser?Busch,!leading!to!AB!InBev.!Shortly!after,!the!Belgian!company!acquired!Grupo!Modelo,! active! in! the! Mexican! market.! Very! recently,! it! has! announced! the! megamerger! of! AB! InBev! and! SABMiller,!the!leading!organizations.!! Bargaining power of suppliers Given AB InBev importance on the market, the multinational has a high power over suppliers. Following its M&As, important economies of scale and synergies emerged from the large volume purchased to its suppliers. Industry Rivalry Highly concentrated industry; top 10 companies represent 65% of market share in 2013. AB InBev is never safe from a M&A between two competitors. Bargaining power of buyers Wide range of beers from the lowest price bracket to the highest one. However, distributors have a large negotiation power on prices reducing margin (off trade consumption) comparing to margin on on trade consumption. Threat of substitutes High variety of other alcoholic beverages such as wine, ciders, hard liquor and trend towards a consumption of non-alcoholic beverages rather than alcoholic ones. Threat of new entrants Low entry barriers but it changes from one market place to another. Lots of microbreweries penetrate the market everyday but it became very difficult to compete with AB InBev.
  7. 7. 7 The!company’s!global!headquarter!is!located!in!Leuven,!a!city!in!Belgium.!As!AB!InBev!has!divided!its! market!in!nine!geographic!zones,!it!counts!several!decentralized!zone!headquarters!like!the!one!in! St.!Louis,!in!the!United!States,!that!is!responsible!for!the!North!American!market.!! ! Table 3: Market share of AB InBev in the different zones in 2013 Country! Market!share! Country! Market!share! United!States! 47.2%! Belgium! 56%! Canada! 40.1%! Germany! 8.8%! Mexico! 58.4%! United!Kingdom! 17.2%! Brazil! 67.9%! Russia! 15.1%! Argentina! 78.5%! China! 14.1%! Source:!Calmé,!I.,!&!Polge,!M.!(2015).!11!cas!de!stratégie:!études!de!cas!d'entreprises!avec!corrigés!détaillés.!Paris:!Dunod! ! The!leading!company!has!achieved!market!presence!in!over!100!markets!where!it!sells!its!global,! multi?country! and! local! brands! of! which! there! are! over! 400! since! its! merger! with! SABMiller.! Obviously,! the! most! well! known! are! global! brands! that! are! Budweiser,! Corona! and! Stella! Artois.! Thanks! to! the! Budweiser! brand,! AB! InBev! possesses! 42%7 ! of! the! premium! market.! Furthermore,! Budweiser!is!part!of!the!168 !brands!are!able!to!generate!more!than!1$!billion!revenue!a!year.!! Figure 3. AB InBev World’s Presence Before and After the Merger with SABMiller !! Investor!Presentation!(2015).!Building!the!first!truly!global!beer!company.!Retrieved!April!7!2017!from!http://www.ab? inbev.com/content/dam/universaltemplate/abinbev/pdf/investors/quaterly? reports/2016/ABInBev_Full_Year_2015_Investor_Presentationt_External.pdf! ! Growing!its!global!brands!is!one!of!the!four!goals!of!the!company.!The!others!include!premiumizing! and!invigorating!beer,!elevating!their!core!and!developing!the!near!beer!segment.9 !! 7 !Calmé,!I.,!&!Polge,!M.!(2015).!11!cas!de!stratégie:!études!de!cas!d'entreprises!avec!corrigés!détaillés.!Paris:!Dunod.! 8 !AB!InBev,!(2016).!Introductory!presentation.!Retrieved!April!24,!2017,!from!http://www.ab? inbev.com/content/dam/universaltemplate/abinbev/pdf/investors/15January2016/Anheuser?Busch%20InBev%20–%20Roadshow%20– %20January%202016.pdf! 9 !AB!InBev!Corporate!
  8. 8. 8 To!conclude,!from!the!company!overview,!some!forces!and!weaknesses!were!highlighted!and!from! the! industry! overview,! some! opportunities! and! threats! were! emphasized! in! the! following! SWOT! analysis:! ! Figure 4. AB InBev’s SWOT analysis! ! ! ! 1.3. Strategy overview ! “Bringing!people!together!for!a!better!world”!is!AB!InBev’s!motto.!It!wants!its!beer!brands!to!bring! people! together! by! offering! true! experiences,! while! driving! growth! for! the! company.! Their! diversified!offer!aims!to!adapt!to!everyone’s!preferences.!As!help!to!achieve!this,!the!global!leader! produces!beers!for!four!different!reasons:!getting!together!to!share!good!times,!finding!the!perfect! beer!to!accompany!great!meals,!breaking!out!of!the!routine!and!having!a!little!fun!and!finally,!beer’s! role!in!bars,!clubs,!restaurants.10 !! ! 1.4. Main globalization drivers ! From! the! very! beginning,! AB! InBev! has! global! ambitions.! It! rapidly! wants! to! conquer! the! world,! engaging!in!M&As!to!trigger!external!growth.!Establishing!itself!as!global!leader!in!the!light!of!its! market! presence,! it! avoids! or! even! eliminates! competition.! Finally,! synergies! leading! to! cost! reduction!are!also!a!main!driver!for!globalization.!! 10 !AB!InBev,!(2016).!Introductory!presentation.!Retrieved!April!24,!2017,!from!http://www.ab? inbev.com/content/dam/universaltemplate/abinbev/pdf/investors/15January2016/Anheuser?Busch%20InBev%20–%20Roadshow%20– %20January%202016.pdf! INTERNAL STRENGTHS ! WEAKNESSES ! EXTERNAL OPPORTUNITIES ! THREATS ! •  Global leader of the beer industry: one out of 3 beers in the market belongs to AB InBev •  Cost advantages due to lots of synergies and M&As •  Huge brand portfolio with global, international and local champions answering customers’ needs and wants internationally and locally •  Effective marketing strategy •  Focuses all its efforts only on beer while consumption trends are moving to other alcoholic and non-alcoholic beverages •  Massive redundancies linked to M&As •  Higher debt ratio than its competitors •  Further M&As could strengthen the position of a company •  Possible M&A with one of the top fast moving consumption goods companies (Coca-Cola); focusing on other drinks could allow companies to gain market share •  Penetrating China that will represent 43% of the world growth up to 2020 •  Government and marketing regulations on alcoholic beverages •  Change in consumption habits leading to a more healthy lifestyle excluding alcoholic beverages from one’s diet •  Shift towards a craft beer consumption and lots of microbreweries enter the market everyday •  Possible increase of raw materials prices
  9. 9. 9 2. ASSESSMENT OF PAST INTERNATIONALIZATION STRATEGIES OF AB- INBEV 2.1. AB InBev’s main pillars for a successful integration ! The!beer!industry!being!highly!competitive,!AB!InBev’s!repeatable!business!has!taken!the!company! on! a! global! expansion! path! where! mergers! and! acquisitions! serve! as! an! enduring! competitive! advantage.11 !!! ! According!to!Laurence!Capron,!professor!of!Strategy!at!INSEAD,!its!is!based!on!three!main!pillars.! First,! the! company! has! developed! integration! principles! such! as! cost! reduction! recognized! by! its! leaders!over!the!years.!Second,!the!unique!corporate!culture!of!AB!InBev!“Dream.!People.!Culture”! relies!on!ten!guidelines!(Appendix!5.1.)!that!are!imposed!on!all!companies!that!it!controls.!Third,!the! removal! of! iconic! brands,! massive! layoffs! and! rationalization! of! suppliers! at! the! expense! of! the! development! of! the! local! ecosystem! may! be! consequences! of! AB! InBev’s! unscrupulous! implementation! strategy.! Many! denounce! the! brutal! nature! of! the! company’s! post! acquisition! integration.! ! So! far,! AB! InBev! has! experienced! ten! years! of! mergers! and! acquisitions,! which! has! become! a! common! practice! in! the! beer! industry! that! is! booming.! The! race! for! size! can! be! explained! by! important!potential!economic!savings:!business!combinations!allow!companies!to!use!each!other’s! distribution!channel!and!it!also!enables!a!leverage!effect!on!raw!materials.!Consequently,!synergies! present!one!of!the!main!reason!for!groupings.!! ! 2.2. Mergers and Acquisitions ! 2.2.1. Interbrew and Ambev In!March!2004,!Interbrew!and!Ambev!had!announced!their!“merger!of!equals”!that!has!catapulted! them!to!leader!position!of!the!global!beer!industry!with!14%12 !market!share,!overtaking!long?time! market!leader!Anheuser?Busch!in!terms!of!volume.13 !The!$11.2!billion!merger!has!benefited!both! parties!as!it!enabled!them!to!expand!their!markets;!Ambev!and!Interbrew!entered!respectively!the! North!American!market!and!Latin!America.!Most!importantly!though!remained!Interbrew’s!access!to! Brazil!as!it!is!one!of!the!fastest?growing!beer!markets!in!the!world.14 !As!a!matter!of!fact,!this!market! is!expected!to!represent!more!than!9%!of!the!volume!of!the!global!market!by!2020.!Besides,!the! merger! that! was! expected! to! create! about! $280! million! synergies! had! as! goal! to! dissuade! or! 11 !Martin,!W.!(2017).!Heineken!is!taking!tips!on!how!to!sell!beer!from!an!American!craft!brewer.!Business!Insider.!Retrieved!04!April!2017,! from!http://uk.businessinsider.com/interview?with?heineken?cfo?laurence?debroux?on?its?partnership?with?lagunitas?2016?2! 12 !AmBev!Agrees!to!Merge!with!Interbrew.!(2017)!Bloomberg.com.!Retrieved!7!April!2017,!from! https://www.bloomberg.com/news/articles/2004?03?02/ambev?agrees?to?merge?with?interbrew! 13 !Cordes,!R.!(2004).!Interbrew!buys!Brazilian!brewer.!Retieved!7!April!2017,!from!http://search.proquest.com/docview/220351451?pq? origsite=summon! 14 ! Smith,! S.! (2017).!Interbrew! Said! to! Be! Near! Deal! for! Brazil! Brewer.!Nytimes.com.! Retrieved! 7! April! 2017,! from! http://www.nytimes.com/2004/03/02/business/interbrew?said?to?be?near?deal?for?brazil?brewer.html?_r=0!
  10. 10. 10 eliminate!potential!competition!present!in!these!markets.!Beck,!Stella!Artois!and!Brahma!became! the!leading!global!brands!while!other!specialty!and!local!brands!were!strengthened.15 !! ! As! a! result,! all! three! brands! were! ranked! in! the! top! 2016 ! beer! brands! after! the! merger.! Also,! InterbrewAmbev! –! as! the! new! company! had! been! called! –! adopted! number! one! or! number! two! positions! in! 1517 ! markets! in! the! world,! with! its! headquarters! staying! in! Leuven,! Belgium.18 ! This! strategic!move!had!considerably!accelerated!the!pace!of!consolidation!in!the!industry.! 2.2.2. Anheuser-Busch and InBev In! 2008,! InBev! merged! with! Anheuser?Busch! for! a! total! amount! of! $52! billions19 ! and! became! Anheuser?Busch!InBev,!the!world’s!largest!brewer!with!20,17%20 !market!share!surpassing!its!closest! competitor! at! that! time! SABMiller.! It! allowed! the! merging! entity! to! strengthen! and! enlarge! its! geographical!presence!benefiting!from!the!expertise!of!both!previous!companies!in!their!respective! markets.! Moreover,! important! synergies! emerged! from! this! strategic! move! leading! to! significant! cost?savings!since!approximately!$1,521 !million!synergies!were!expected!for!2011.!Finally,!it!helped! pushing!brands!through!the!distribution!channels!in!a!more!effective!way.22 ! ! The! combination! added! the! well?known! American! beer! Budweiser! to! AB! InBev’s! global! brands! portfolio.!The!merging!entity!was!supposed!to!generate!a!quarter!of!the!world!total!beer!volume! and!to!trigger!revenues!of!at!least!$36,4!billions.23 !The!cross?cultural!merger!boosted!the!entity!in! the!top!5!of!fast!moving!consumer!goods!companies!alongside!Procter!&!Gamble,!PepsiCo,!Nestlé! and!Unilever.24 ! 2.2.3. Acquisition of Grupo Modelo ! Four!years!after!the!merger!of!Anheuser?Busch!and!InBev,!AB!InBev’s!executives!put!$2025 !billions!on! the! table! as! they! had! identified! new! cost! and! revenue! benefits! resulting! in! $1! billion26 ! synergies! which!could!derive!from!the!full!control!of!Grupo!Modelo,!the!largest!brewery!of!Mexico!and!holder! 15 ! Cioletti,! J.! (2015).! A! new! global! giant! is! born.! Retrieved! 7! April! 2017! from! http://web.b.ebscohost.com/ehost/detail/detail?sid=d53b2f3b?8725?4b21?a8d4? 46f40e491d51%40sessionmgr103&vid=0&hid=116&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3d%3d#AN=12814222&db=buh! 16 ! Rissingh,! D.! (2017).! Interbrew! and! AmBev! merge! to! create! biggest! brewer.! Telegraph.co.uk.! Retrieved! 7! April! 2017,! from! http://telegraph.co.uk/finance/2878842/Interbrew?and?AmBev?merge?to?create?biggest?brewer.html!! 17 !Ibid! 18 ! ! Interbrew! buys! AmBev! and! becomes! world! number! one.! Retrieved! 6! April! 2017,! from! http://www.beveragedaily.com/Manufacturers/Interbrew?buys?AmBev?and?becomes?world?number?one.! 19 !Beer!monster.!(2015,!September!19).!Retrieved!April!24,!2017,!from!http://www.economist.com/news/business/21665074?ab?inbev? may?combine?sabmiller?flat?market?big?beer?brands?beer?monster! 20 ! Vipul! Sonavane,! Business! Analyst! at! HSBC! Follow.! (2013,! October! 29).! Ab! inbev! m&a.! Retrieved! April! 24,! 2017,! from! https://www.slideshare.net/VipulSonavane/ab?inbev?ma?team?4! 21 !Anheuser?Busch!InBev!ADR.!(n.d.).!Retrieved!April!24,!2017,!from!http://www.boursier.com/actions/actualites/news/anheuser?busch? inbev?adr?US03524A1088,US.html! 22 ! Merced,! M.! J.! (2008,! July! 13).! Anheuser?Busch! Agrees! to! Be! Sold! to! InBev.! Retrieved! April! 7,! 2017,! from! http://www.nytimes.com/2008/07/14/business/worldbusiness/14beer.html! 23 !Point,!M.!L.!(n.d.).!Archives.!Retrieved!April!9,!2017,!from!http://www.lepoint.fr/actualites/2008?07?14/inbev?rachete?anheuser?busch? pour?52?milliards?de?dollars/1037/0/260350! 24 !Ibid! 25 !Beer!monster.!(2015,!September!19).!Retrieved!April!24,!2017,!from!http://www.economist.com/news/business/21665074?ab?inbev? may?combine?sabmiller?flat?market?big?beer?brands?beer?monster! 26 ! I.! (2013,! June! 04).! Anheuser?Busch! InBev! a! finalisé! l'acquisition! de! Grupo! Modelo.! Retrieved! April! 7,! 2017,! from! https://investir.lesechos.fr/actions/actualites/anheuser?busch?inbev?a?finalise?l?acquisition?de?grupo?modelo? 885299.php#bQVsVz1GfaWHdC7s.99!
  11. 11. 11 of! the! already! global! and! promising! Corona! brand.27 ! The! acquisition! had! among! its! purposes! to! confirm!AB!InBev’s!strategic!vision,!strengthen!it!leader!position!on!the!global!beer!market,!holding! from!then!on!five!out!of!six!of!the!best?selling!beer!brands.28 ! 2.2.4. Acquisition of SABMiller ! Monday!the!10th!of!October!2016,!AB!InBev!merged!with!SABMiller!to!form!the!first!truly!global! brewer,!representing!the!third!largest!takeover!in!corporate!industry.!The!combined!entity,!that!is! since!that!day!responsible!for!one!out!of!three!beers!sold!all!around!the!globe29 ,!should!generate! annual!revenue!of!roughly!$55!billion30 !on!a!pro?forma!basis.!Several!motives!are!behind!this!$103! billion31 !transaction.!! ! First,! it! opens! the! door! to! the! African! market! that! represents! a! main! driver! of! growth! for! the! company,!and!reinforces!the!combined!company’s!worldwide!footprint.!Indeed,!whereas!AB!InBev’s! presence! in! Africa! was! negligible,! SABMiller! ?! literally! South! African! Breweries! –! dominated! this! market!by!far!by!volume!share!with!38,8%32 ,!generating!nearly!one!third33 !of!its!profits.!Moreover,!it! strengthens! AB! InBev’s! position! on! the! South! American! market,! especially! in! Colombia! and! Peru.! Emerging! markets! are! a! particularly! interesting! target;! the! middle! class! is! expanding! in! these! countries!translating!into!an!increase!of!beer!consumption.!Furthermore,!low!levels!of!penetration! for! the! premium! beer! segment! are! being! observed! in! South! America! although! the! average! disposable!income!grew!these!last!years.!It!turns!out!that!SABMiller!precisely!adopted!a!premium! brand!positioning.34 !This!merger!allows!the!Belgo?Brazilian!brewer!to!raise!its!sales!volume!thanks!to! the!boom!of!beer!consumption!in!emerging!markets.!It!will!also!lead!it!to!an!increase!in!its!profits! thanks!to!a!better!positioning!on!the!premium!beer!segment.35 !! ! Second,!to!not!damage!AB!InBev’s!cost!savings!reputation,!this!merger!of!equal!is!expected!to!trigger! important!synergies,!approximately!$1,4!billion36 !savings!annually.!!! Finally,! it! consolidates! AB! InBev’s! 5th! ranking! among! the! world’s! leading! consumer! products! companies!in!terms!of!revenues.! ! 27 !Financial!Times.!(n.d.).!Retrieved!April!8,!2017,!from!https://www.ft.com/content/1aada18a?c1da?11e1?8e7c?00144feabdc0! 28 ! I.! (2013,! June! 04).! Anheuser?Busch! InBev! a! finalisé! l'acquisition! de! Grupo! Modelo.! Retrieved! April! 7,! 2017,! from! https://investir.lesechos.fr/actions/actualites/anheuser?busch?inbev?a?finalise?l?acquisition?de?grupo?modelo? 885299.php#bQVsVz1GfaWHdC7s.99! 29 !Beer!monster.!(2015,!September!19).!Retrieved!April!24,!2017,!from!http://www.economist.com/news/business/21665074?ab?inbev? may?combine?sabmiller?flat?market?big?beer?brands?beer?monster! 30 ! Bray,! C.! (2016,! September! 27).! Merger! of! Anheuser?Busch! InBev! and! SABMiller! Faces! Final! Hurdle.! Retrieved! April! 8,! 2017,! from! https://www.nytimes.com/2016/09/28/business/dealbook/merger?of?anheuser?busch?inbev?and?sabmiller?faces?final?hurdle.html?_r=0! 31 ! Buckley,! T.! (2016,! September! 28).! Anheuser?Busch! InBev! Clinches! $103! Billion! SABMiller! Deal.! Retrieved! April! 4,! 2017,! from! https://www.bloomberg.com/news/articles/2016?09?28/sabmiller?investors?give?go?ahead?for?103?billion?megabrew?deal! 32 !Global!Beer!Consumption!Statistics!and!Trends.!(n.d.).!Retrieved!April!7,!2017,!from!http://visual.ly/global?beer?consumption?statistics? and?trends! 33 !Beer!monster.!(2015,!September!19).!Retrieved!April!24,!2017,!from!http://www.economist.com/news/business/21665074?ab?inbev? may?combine?sabmiller?flat?market?big?beer?brands?beer?monster! 34 ! Great! spectaculations.! (2014).! Anheuser?Busch! InBev:! What! The! SABMiller! Acquisition! Could! Mean.! Retrieved! ! from! https://www.forbes.com/sites/greatspeculations/2014/09/18/anheuser?busch?inbev?what?the?sabmiller?acquisition?could? mean/#1c4caea23c49! 35 !Calmé,!I.,!&!Polge,!M.!(2015).!11!cas!de!stratégie:!études!de!cas!d'entreprises!avec!corrigés!détaillés.!Paris:!Dunod.!! 36 ! Buckley,! T.! (2016,! September! 28).! Anheuser?Busch! InBev! Clinches! $103! Billion! SABMiller! Deal.! Retrieved! April! 24,! 2017,! from! https://www.bloomberg.com/news/articles/2016?09?28/sabmiller?investors?give?go?ahead?for?103?billion?megabrew?deal!
  12. 12. 12 To!overcome!antitrust!issues,!the!combined!entity!signed!several!agreements!to!sell!assets!to!obtain! regulators’!approval.!SABMiller!had!to!give!up!on!its!partnership!with!MillerCoors!in!the!USA!and!had! to!sell!its!equity!interest!in!CR!Snow!in!China!among!others.37 ! ! 2.3. Internationalisation strategy ! In! this! industry! where! the! competitive! climate! is! intense,! companies! have! no! other! choice! than! engaging!in!mergers!and!acquisitions!to!win!market!share.!Behind!AB!InBev’s!internationalization! process!hides!an!external!growth!strategy.!The!company’s!global!ambition!is!to!be!the!main!global! player!of!the!industry.!To!this!end,!AB!InBev!acquired!strategic!groups!to!increase!its!global!reach! and!its!competitive!positioning.!Hence,!the!acquisition!of!Grupo!Modelo!led!AB!InBev!to!a!leading! position!in!Mexico.!Its!presence!in!the!latter!country!is!essential!given!that!EBITDA!margin!in!Mexico! is! at! least! 15! percentage! points! (between! 46! et! 52%)! higher! than! the! company! average! EBITDA! amounting!to!40%38 .!AB!InBev!merger!with!SABMiller!conducted!the!company!to!gain!substantial! market! share! in! Africa! where! its! presence! was! until! then! completely! insignificant.! In! addition! to! these!two!added!value!triggered!by!its!mergers!and!acquisitions,!horizontal!mergers!and!acquisitions! such!as!the!merger!with!Anheuser?Busch!are!particularly!interesting!for!purposes!of!consolidation.!It! allows!the!global!combined!entity!to!benefit!from!synergies!and!economies!of!scale!from!the!sharing! of!means!of!production!but!more!importantly!distribution!network.!In!ten!years,!AB!InBev’s!EBITDA! increased!by!an!average!annual!growth!rate!of!38%!between!2000!and!201039 .! ! AB!InBev!seems!to!hold!a!winning!formula!in!its!hands.!Mergers!and!acquisitions!give!rise!to!a!high! speed! of! entry! in! a! new! market,! a! high! market! penetration! and! a! high! control! of! the! market! benefiting!from!the!acquired!or!merged!company’s!expertise!and!knowledge!over!its!customer!base.! Comparing!AB!InBev’s!volume!growth!rate!between!2009!and!2014!with!the!global!market!volume! growth,!one!can!observe!that!this!entry!mode!speeds!up!AB!InBev’s!growth!up.!On!top!of!that,!it! deeply!demonstrates!that!the!world’s!first!global!brewer’s!growth!strategy!uses!M&A!to!increase!its! capacity!for!growth!instead!of!organic!growth.!!! ! Figure 5. AB InBev World’s Presence Before and After the Merger with SABMiller ! ! ! ! ! ! ! ! ! ! ! 37 ! Bray,! C.! (2016,! July! 29).! Anheuser?Busch! InBev! Merger! With! SABMiller! Advances.! Retrieved! April! 4,! 2017,! from! https://www.nytimes.com/2016/07/30/business/dealbook/china?beer?anheuser?busch?inbev?sabmiller.html?_r=0! 38 !Calmé,!I.,!&!Polge,!M.!(2015).!11!cas!de!stratégie:!études!de!cas!d'entreprises!avec!corrigés!détaillés.!Paris:!Dunod.!! 39 ! Allen! J.,! Zook! C.! (2012)! The! strategic! principles! of! repeatability.! Retrieved! April! 4,! 2017,! from! http://www.bain.com/publications/articles/the?strategic?principles?of?repeatability.aspx! 0! 2! 4! 6! 8! 10! 12! 2009?2010! 2010?2011! 2011?2012! 2012?2013! 2013?2014! AB!InBev!Volume!Growth! Global!Market!Volume!Growth! %!y?o?y!Volume!Growth!
  13. 13. 13 Even! though! mergers! and! acquisitions! require! a! substantial! upfront! financial! but! also! managerial! investment,!it!does!not!represent!a!drawback!of!this!entry!mode!for!AB!InBev.!Indeed,!despite!that!it! resulted!in!a!higher!debt!ratio!for!AB!InBev!than!its!competitors40! ,this!can!be!seen!as!a!positive!debt! when!taking!into!account!the!added!value!and!the!competitive!positioning!that!these!mergers!and! acquisitions!brought!to!the!initial!company.!Moreover,!AB!InBev’s!strong!desire!to!impose!its!culture! to!the!entities!that!merged!with!it!leads!to!successful!post?acquisition!phases.! ! The!main!players!in!the!beer!industry!are!now!present!on!every!continent,!after!being!established! first!in!Europe!or!in!the!United!States.!This!implies!a!dual!suggestion;!first,!more!emphasis!should!be! placed!on!emerging!markets!that!offer!growth!opportunities!since!beer!consumption!experiences! steady!increases!and!second,!a!higher!focus!should!be!given!to!premium!brands!like!flavored!beer! brands! that! are! mainly! offered! in! developed! countries! where! consumption! is! stable! or! even! decreasing.! ! As!other!global!players,!AB!InBev!adopted!a!glocal!strategy,!which!refers!to!the!“think!global,!act! local”!strategy.!In!other!words,!the!company!uses!its!global!experiences!to!design!their!products!in! an! appealing! way! for! local! consumers.! As! such,! the! company! counts! several! international,! multi? country!and!local!brands!in!its!product!portfolio,!resulting!in!a!higher!choice!for!its!customers.!One! the! one! hand,! AB! InBev! works! hard! to! bring! its! three! global! brands! (Corona,! Stella! Artois! and! Budweiser)!all!around!the!world.!On!the!other!hand,!some!factors!such!as!cultural!differences!are! pushing!against!globalisztion!reminding!that!the!world!is!not!flat.!To!overcome!this!issue,!AB!InBev! holds!under!its!company!name!several!local!champions!fully!adapted!to!the!needs!and!wants!of!the! locals!and!their!very!specific!culture.!Global!presence!and!the!benefits!of!flexibility,!proximity!and! quick! response! time! characterizing! a! localization! strategy! are! both! essential! for! the! first! global! brewer!to!strengthen!and!expand!even!more!its!business!model!around!the!globe.! ! 2.3.1. Comparison of AB InBev with its closest competitor: Heineken Since!the!merger!announcement!of!AB!InBev!with!SABMiller,!the!newly!formed!company!has!clearly! acquired!a!leader!position!on!the!beer!market.!Main!competitors!include!Heineken!and!Carlsberg,! despite!their!much!smaller!size.!Even!before!the!merger,!in!2013,!AB!InBev!alone!owned!more!than! twice! the! market! share! of! Heineken.! Nevertheless,! Heineken! dominates! the! Australian! market! where!it!counts!17.3%41 !market!share!and!the!West!European!markets!with!17.3%!market!share!as! well.! It!appears!that!Heineken!puts!more!emphasis!on!marketing!than!AB!InBev.!As!a!matter!of!fact,!the! Dutch! company! and! AB! InBev! have! invested! respectively! 12%42 ! and! 13%43 ! of! their! turnover! for! marketing!purposes!over!the!reference!period!from!2008!to!2013.!As!AB!InBev’s!turnover!is!almost! twice! the! turnover! of! Heineken,! one! can! conclude! that! Heineken! focuses! more! on! marketing,! despite!strict!marketing!rules.! 40 !Calmé,!I.,!&!Polge,!M.!(2015).!11!cas!de!stratégie:!études!de!cas!d'entreprises!avec!corrigés!détaillés.!Paris:!Dunod! 41 !Ibid! 42 !Ibid! 43 !Ibid!
  14. 14. 14 The!Dutch!competitor!Heineken!adopts!three!main!strategies!to!survive!in!this!highly!competitive! market.!First!and!foremost,!the!company!heavily!relies!on!its!flagship!product!which!is!none!other! than!the!Heineken!beer!itself.!In!2013,!it!represented!only!15%!of!beer!volumes!sold!by!the!group,! while!generating!one!third!of!its!profits.44! This!contributes!to!its!leadership!position!in!the!premium! segment.! Second,! the! Dutch! competitor! segments! its! population! into! different! categories.! Beers! like! Desperados!for!instance!target!urban!consumers!between!the!ages!of!20!to!30!that!are!outgoing.!! Third,! as! AB! InBev,! it! has! implemented! a! “think! global,! act! local”! strategy.! Some! brands! are! international,!others!are!local.!Hence,!Heineken!can!develop!a!large!product!portfolio!where!each! brand! targets! a! specific! kind! of! clients.! It! also! produces! cider.! Despite! the! identical! strategy,! Heineken!only!possesses!two45 !“one!billion!dollars”!brands,!as!compared!to!AB!InBev!that!count!16! in!its!product!portfolio.!For!its!part,!Carlsberg!has!none.!! In!any!case,!Heineken!operates!with!more!brands!in!a!larger!number!of!countries.!Nevertheless,!the! merger!of!AB!InBev!and!SABMiller!will!overtake!Heineken!at!least!in!terms!of!the!number!of!brands.! Both!companies!have!different!approaches!regarding!internationalisation.!To!strengthen!its!position! on! the! market! and! to! build! a! profile! abroad,! Heineken! first! opted! for! an! export?based! strategy! before!moving!gradually!towards!a!local!production!strategy.!! As!it!was!first!established!150!years!ago,!Heineken!started!selling!in!and!around!Amsterdam.!Rapidly,! it! seized! exportation! opportunities! leading! to! a! business! combination! with! Oranjeboom,! another! Dutch!brewery.!This!announced!the!beginning!of!the!switch!towards!local!production.!It!first!started! in! Singapore! in! 1931,! where! Heineken! entered! a! Joint! Venture! with! a! soft! drink! producer! to! get! closer!to!modern!India,!its!main!export!market.!! Since!the!1950s,!Heineken!follows!a!double!track!policy:!on!the!one!hand,!it!continues!exporting! from!the!Netherlands!to!countries!like!the!United!States!where!only!imported!Heineken!are!sold,! and! on! the! other! hand,! it! keeps! buying! stakes! in! local! brewers.! This! internationalisation! strategy! made!Heineken!the!world’s!most!international!brewer,!possessing!a!global!network!of!distributors,! owning!115!breweries!in!more!than!65!countries.! The!merger!between!AB!InBev!and!SABMiller!clearly!isolates!Heineken!and!Carlsberg!in!the!brewing! industry.! Nevertheless,! the! group! had! to! give! up! their! shares! in! different! companies! that! now! present!growth!opportunities!for!the!challengers!Heineken!and!Carlsberg.!!! 44 !Burg,!D.!(2013,!November!22).!Heineken,!ses!trois!recettes!pour!abreuver!le!monde.!Retrieved!April!4,!2017,!from! https://business.lesechos.fr/directionsQgenerales/strategie/developpementQinternational/0203138681422QheinekenQsesQtroisQrecettesQ pourQabreuverQleQmondeQ57157.php?LHy2YrfrH5wsiblX.99 45 !Calmé,!I.,!&!Polge,!M.!(2015).!11!cas!de!stratégie:!études!de!cas!d'entreprises!avec!corrigés!détaillés.!Paris:!Dunod!
  15. 15. 15 Table 4: Comparison of AB InBev with Heineken ! AB!InBev! Heineken! Turnover!in!2015!(in! billions)! 43,604! 20,511! EBITDA!in!2015!(in! billions)! $!17,057! €!2,034! Number!of!brands! Around!400!since!the!merger! More!than!250! Structure!of!the! company! Geographical!model! Geographical!model! Global!ambition! Market!driving! Active!worldwide! Consumer/Innovation!driven! Active!worldwide! Global!positioning! Targeting!nearly!all!segments! Repeatable!business!model! Targeting!nearly!all!segments! Repeatable!business!model! Global!organisation! Global!value!chain! Global!value!chain! Drivers!for! globalisation! Synergies,!external!growth,! market!presence,!competition! reduction! External!growth,!market!presence! Marketing!mix! Product:!Beer,!soft!drinks! Place:!Retailers,!bars,!party!places! Promotion:!Lower!focus!on! marketing! Price:!lowest!possible!price! Product:!Beer,!cider,!soft!drinks! Place:!Retailers,!bars,!party!places! Promotion:!Focus!on!marketing! Price:!higher!price!to!keep!a! “gentlemen!beer”! Positioning! Bringing!people!together!for!a! better!world:!accountability,! integrity,!continual!improvement! and!a!mind?set!of!doing!the!right! thing!for!the!long!term! We!Are!Heineken:!passion!for! quality,!enjoyment!of!life,!respect!for! people!and!the!planet! Segmentation! Behaviouristic,!demographic,! geographic,!psychographic! Behaviouristic,!demographic,! geographic,!psychographic! Innovation! Global!innovation!Centre!in! Leuven,!Belgium! Innovation!space!for!co?creation! ! 3. INTERNATIONALIZATION STRATEGY RECOMMENDATIONS The! African! market! and! the! Asia! Pacific! market! will! play! major! roles! in! the! generation! of! new! revenue!and!the!creation!of!growth!for!AB!InBev.!The!first!one!has!been!untapped!for!long!before! the!merger!with!SABMiller.!Then,!the!Asia!Pacific!market!and!particularly!China!represent!a!huge! potential!of!growth!for!the!world’s!leading!brewer.!Indeed,!the!population!of!this!part!of!the!world!is! non?negligible!as!it!represents!alone!more!than!a!half!of!the!world!population!and!will!account!for! 46%! of! the! world! population! growth! between! 2014! and! 2025.! On! top! of! that,! Asia! Pacific! is! the! largest!region!in!the!beer!industry!in!terms!of!volume!consumed,!and!will!be!responsible!for!53%!of! the!growth!between!2014!and!2025.! Regarding!the!Asia!Pacific!market,!AB!InBev’s!strategy!will!first!focus!on!China!for!several!reasons.! First,!China!represents!37%!of!Asia!Pacific’s!population!and!is!the!largest!economy!in!the!region,!
  16. 16. 16 representing!43%!of!the!region’s!GDP46 .!Second,!it!is!the!largest!beer!market!in!the!world.!Beer!is!the! most!widely!consumed!beverage!in!this!country!right!after!tea.!The!beer!market!accounts!for!66%!of! the!Asia!Pacific!industry.!The!Chinese!market!is!expected!to!provide!31%!of!the!world!volume!growth! in!the!next!ten!years.!The!Chinese!beer!market!largely!surpassed!the!American!market!in!terms!of! sales!volume!in!2002!and!is!to!this!day!roughly!twice!its!size.!On!the!other!hand,!the!Chinese!market! lacks!behind!the!American!market!in!terms!of!value!by!21%!in!2013.47! It!is!mainly!because!of!the!! penetration!of!local!low?cost!beers!and!value!brands!that!are!higher!in!China!than!it!in!the!United! States.!According!to!Euromonitor,!while!sales!of!lager!beers!amount!to!only!one!fourth!of!the!net! volumes!in!the!US!in!2013,!this!segment!constitutes!over!80%!of!the!net!volume!in!China.48 !Low? priced!beer!being!quite!popular!in!China,!it!still!represents!an!opportunity!of!revenue!growth!for! brewers! all! around! the! globe.! However,! growth! in! disposable! income! and! the! upcoming! trend! relative!to!the!premium!beer!segment!could!lead!emerging!beers!lovers!to!trade!up!low?priced!beer! for!premium!beer,!triggering!higher!margin.49 !In!addition,!in!recent!years!the!growth!of!premium! beer!(5,5%)!surpasses!the!growth!of!standard!beer!(4%)!in!Asia!Pacific.50 !! Figure 6. Two opportunities of Development for AB InBev’s future strategy ! ! ! ! ! ! ! ! ! The!Chinese!internal!diversity!makes!AB!InBev’s!expansion!challenging!in!this!market.!To!capture! growth! potential! represented! by! the! growing! Chinese! middle! class! and! because! China! clusters! a! wide! range! of! different! cultures,! AB! InBev! should! look! beyond! averages! and! adapt! its! strategy! depending!on!the!geographical!location,!the!desired!target!and!the!distribution!channel.!Therefore,! to!win!nationally!in!premium,!thus!in!value!while!expanding!and!increasing!its!leadership!province!by! province,!here!in!volume,!the!company!will!have!to!play!on!two!growth!engines.!! 46 !See!Appendix!6.1.! 47 ! Great! Speculations.! (2017).! China! Is! Key! To! AB! InBev's! Asia! Growth! Prospects.! Forbes.com.! Retrieved! 3! April! 2017,! from! https://www.forbes.com/sites/greatspeculations/2015/01/16/china?is?key?to?ab?inbevs?asia?growth?prospects/#7b3326472df2 48 !Ibid! 49 ! Jingxi,! X.! (2017).!AB! InBev! optimistic! about! growth.!Chinadaily.com.cn.! Retrieved! 1! April! 2017,! from! http://www.chinadaily.com.cn/business/2017?01/14/content_27952858.htm! 50 !Calmé,!I.,!&!Polge,!M.!(2015).!11!cas!de!stratégie:!études!de!cas!d'entreprises!avec!corrigés!détaillés.!Paris:!Dunod!
  17. 17. 17 The!first!growth!engine!is!the!premiumization.!The!Chinese!beer!industry!is!evolving.!Today,!there!is! a!need!to!provide!a!solution!for!a!new!kind!of!craving.!Generation!Y!accounts!for!almost!one!third!of! the!world!largest!country’s!population!and!this!generation!shifts!towards!a!consumption!of!flavored! alcoholic!beverages,!ciders!and!more!importantly!towards!imported!premium!beers.!Moreover,!the! number!of!urban!middle!and!affluent!class!consumer!households!will!grow!from!approximately!35%! representing! 102! million! in! 2014! to! roughly! 75%! accounting! for! 299! million! of! the! total! Chinese! population!in!203051 .!These!categories!of!people!are!more!prone!to!consume!premium!beers.!!AB! InBev!already!understood!the!importance!of!the!premium!trend!with!its!continuous!focus!on!the! development!of!the!position!of!its!global!brand!Budweiser!on!the!Chinese!market.!AB!InBev!has!to! look!for!organic!growth!in!this!market!mainly!in!terms!of!growth!in!revenue!per!unit!case.!Given!the! company! positioning! on! the! premium! segment! and! the! rising! middle! class,! demand! for! premium! beers!such!as!Budweiser!and!Harbin!Ice!could!grow!even!further.!On!top!of!that,!AB!InBev!has!to! deepen!this!growth!opportunity!in!order!to!avoid!suffering!from!the!forthcoming!growth!decline!in! the!Core+!and!the!Core!&!Value52 !segments.!! ! Table 5. Industry Growth per Beer Segment ! ! ! ! ! ! ! ! ! Staley,!G.!(2015).!Asia!Pacific.!1st!ed.!Boston.! ! The! development! of! the! Super! Premium! segment! characterized! by! quality! beers! at! high! price! appears! as! an! evidence! in! the! light! of! the! recent! market! and! demographic! trends.! Although! the! share! of! Super! Premium! beers! consumed! is! relatively! low! amounting! to! 0,2%! of! the! total! beer volume!in!China,!this!segment!provides!a!growth!opportunity!that!could!trigger!margin!nine!times! higher! than! what! the! Core&Value! segment! does.53 ! From! the! latter! perspective,! the! beer! giant! decided!to!introduce!its!global!beer!Corona!in!China!last!August,!to!strengthen!its!premium!portfolio! in!this!market.!! ! Another!strategy!could!be!adopted!to!consolidate!AB!InBev!position!on!the!premium!segment!that! could!be!called!“win!with!the!winners”.!Indeed,!craft!beer!is!not!only!a!growth!driver!but!it!is!also!a! generator!of!revenue..!Over!the!past!decade,!craft!brews!grabbed!20%54 !of!North!American!market! in!value!largely!at!the!expense!of!mass?produced!lagers!such!as!AB!InBev’s!Budweiser!and!Bud!Light.! Last!year,!AB!InBev’s!North!American!sales!decreased!by!2%!and!more!importantly!Budweiser!sales! 51!Staley,!G.!(2015).!Asia!Pacific.!1st!ed.!Boston.! 52!Those!segments!are!composed!of!basic!low!priced!lager!beer!and!regional!brands.! 53!Staley,!G.!(2015).!Asia!Pacific.!1st!ed.!Boston.! 54 Heimer,! M.! (2017).!Why! the! Craft! Beer! Battle! Just! Moved! to! China.!Fortune.com.! Retrieved! 1! April! 2017,! from! http://fortune.com/2017/03/16/craft?beer?china/ ! !! Industry!Growth! !! 2012! 2013! 2014! 2015! Super!Premium! 69.7%! 23.1%! 35.0%! 30.5%! Premium! 11.5%! 11.5%! 10.6%! 10.0%! Core+! 10.8%! 12.1%! 6.0%! 4.8%! Core!&!Value! ?4.3%! 0.0%! ?8.8%! ?9.0%! Total! ?0.6%! 3.2%! ?4.2%! ?4.5%!
  18. 18. 18 have! taken! the! biggest! hit! dropping! by! 35%! since! 200855 .! AB! Inbev! had! to! catch! up! by! simply! acquiring!other!companies!or!by!buying!majority!stakes!in!craft!brewers!to!purchase!the!growth!that! it!is!no!longer!generating!organically.! AB!InBev!has!to!ensure!that!it!does!not!miss!out!China’s!craft!boom!as!it!missed!the!one!in!America.! To!this!end,!AB!InBev!must!build!awareness!around!some!imported!crafted!beers!from!its!current! portfolio! through! negotiations! with! local! distributors! in! cities! carefully! selected! for! their! high! concentration!of!Middle!and!Affluent!population!classes.!Furthermore,!AB!InBev!could!strengthen!its! distribution!network.!It!could!also!consolidate!its!portfolio!of!local!champions!by!buying!some!local! crafted!beer!with!an!already!well?established!position!in!the!targeted!market!(Boxing!Cat).!AB!InBev! has!to!take!advantage!of!regulations!that!are!disproportionately!in!favor!of!the!biggest!players.!In! the!United!States,!it!is!forbidden!for!a!brewer!to!hold!a!monopoly!on!the!beers!sold!in!a!specific!bar! for!example.56 !In!China,!brewers!own!bars!and!control!some!distributors.!Perhaps!more!striking!is! that,!while!Chinese!brewers!have!to!respect!thoroughly!very!restrictive!rules!regarding!quality,!this!is! not!applicable!for!the!big!players!that!already!control!the!global!market!and!import!beers!in!this! region.!To!sum!up,!because!beer!is!part!of!the!few!markets!in!which!China!discriminates!its!local! producers!in!favor!of!foreign!breweries,!AB!InBev!has!to!use!this!advantage!for!its!own!benefit.! ! The! second! growth! engine! is! the! expansion! of! AB! InBev! leadership! province! by! province.! The! recommendation! here! is! to! penetrate! new! Chinese! provinces! through! lager! beers! already! well! known!and!positioned!in!the!market!such!as!the!Harbin.!On!the!other!hand,!AB!InBev!could!also! increase!its!penetration!rate!in!China!by!acquiring!some!small!regional!brewers!with!an!already!well? established! distribution! network,! especially! in! tier! 2! and! 3! cities.! This! would! help! AB! InBev! to! increase! its! sales! volume! by! leveraging! the! expertise! that! the! small! local! brewers! hold! over! the! market.!Despite!the!strong!competitive!environment!and!the!volume!slowdown!in!provinces!where! the!beer!consumption!rate!is!above!the!Chinese!average,!there!are!still!some!growth!opportunities57 .! Indeed,! AB! InBev! has! to! benefit! from! the! urbanization! that! will! drive! up! beer! consumption! in! provinces! with! per! capita! consumption! below! the! Chinese! average! representing! 45%58 ! of! the! Chinese!beer!market.59 ! ! The!merger!with!SABMiller!played!a!major!role!in!AB!InBev’s!penetration!not!only!in!the!African! market!but!also!in!other!markets.! ! 55 ! Cendrowski,! S.! (2017).!AB! InBev:! Budweiser’s! Owner! Is! China’s! New! Craft! Beer! Bully.!Fortune.com.! Retrieved! 16! April! 2017,! from! http://fortune.com/2017/03/16/china?craft?beer?ab?inbev/! 56 ! Cendrowski,! S.! (2017).! AB! InBev:! Budweiser’s! Owner! Is! China’s! New! Craft! Beer! Bully.! Fortune.com.! Retrieved! 16! April! 2017,! from! http://fortune.com/2017/03/16/china?craft?beer?ab?inbev/ 57 !See!Appendix!6.6.! 58 !Staley,!G.!(2015).!Asia!Pacific.!1st!ed.!Boston. ! 59 !See!Appendix!6.3.!
  19. 19. 19 Figure 7. SABMiller Revenue and EBITDA by geography! ! ! ! ! ! ! ! ! ! Investor!Presentation!(2015).!Building!the!first!truly!global!beer!company.!Retrieved!April!7!2017!from!http://www.ab? inbev.com/content/dam/universaltemplate/abinbev/pdf/investors/quaterly? reports/2016/ABInBev_Full_Year_2015_Investor_Presentationt_External.pdf! ! AB!InBev!foresees!high!rises!in!beer!consumption!in!Africa,!resulting!in!a!very!interesting!market!in! the!future!compared!to!Europe!or!North!America.!The!group!expects!Africa’s!beer!volume!to!grow! by!44%60 !between!2014!and!2025,!which!is!close!to!three!times!the!global!rate.!Prior!to!the!merger,! AB!InBev!did!not!have!a!real!entry!to!the!African!market!but!the!group!now!operates!in!31!countries! in! the! new! targeted! continent.! But! the! market! is! clearly! based! on! a! future! opportunity! since! consumers!in!some!of!those!countries!drink!an!average!of!less!than!10!litres!of!beer!per!head!a!year.! Ricardo!Tadeu,!AB!InBev’s!Zone!President!for!Africa61 ,!believes!this!number!can!be!increased!to!46!to! 65!litres!average!depending!on!the!country,!aiming!thus!at!the!45!litres!world!average.62 !These!are! quantities! that! are! already! achieved! in! some! African! countries! such! as! Namibia,! Gabon,! Congo,! Botswana!or!South!Africa.63 !But!this!is!not!the!case!for!most!other!countries!in!the!continent!and! approximately!65!million!people!are!due!to!reach!the!legal!drinking!age!by!2023!which!of!course! means!a!large!portion!of!potential!customers.³! ! InBev!found!the!perfect!open!gate!to!the!African!beer!market!by!buying!SABMiller.!To!have!a!better! understanding! of! this! opportunity,! it! is! interesting! to! look! at! SABMiller's! history.! The! company! is! originally! from! Africa! with! a! group! of! smaller! beer! manufacturers! who! formed! the! South! African! Breweries!Group!(SAB).!They!then!based!the!company!in!London!and!bought!a!large!American!beer! company! called! Miller! and! formed! SABMiller.64 ! By! merging! SABMiller! into! its! business! units,! AB! InBev!assures!itself!a!large!panel!of!physical!facilities,!thanks!to!synergy!opportunities!of!combining! resources! and! cutting! costs! through! best! practice! sharing! and! suppressing! overlapping! regional! headquarters,!but!also!major!knowledge!about!the!market,!taking!advantage!of!SAB’s!experience!in! the!continent.!!! ! 60 Building!the!First!Truly!Global!Beer!Company.!(2015).! 61 Our!team!|!AB!InBev.!(2017).!Ab?inbev.com.!Retrieved!20!April!2017,!from!http://www.ab?inbev.com/our?story/our?team.html! 62 !Kew,!J.,!&!Prinsloo,!L.!(2017).!AB!InBev!to!Wring!Potential!From!Africa!Beer!With!Exports.!Bloomberg.com.!Retrieved!20!April!2017,!from! https://www.bloomberg.com/news/articles/2017?04?12/ab?inbev?sees?africa?as?two?way?street?for?boosting?beer?brands! 63 !Kirin!Beer!University!Report!Global!Beer!Consumption!by!Country!in!2014!|!News!Releases!|!Kirin!Holdings.!(2015).!Kirinholdings.co.jp.! Retrieved!20!April!2017,!from!http://www.kirinholdings.co.jp/english/news/2015/1224_01.html! 64 ! Kitwe,! &! Onitsha.! (2014).! SABMiller! in! Africa! The! beer! frontier.! Economist.com.! Retrieved! 20! April! 2017,! from! http://www.economist.com/news/business/21602999?long?established?african?firm?went?global?only?find?fastest?growing?market?was?its! SABMiller!Revenue!by! Geography! APAC! Europe! North!America! Layn!America! Africa! SABMiller!EBITDA!by! Geography! APAC! Europe! North!America! Layn!America! Africa!
  20. 20. 20 Figure 8. Evolution of the African Beer Volume ! ! ! ! ! ! ! ! ! ! ! ! ! The!Economist.!(2014).!SABMiller!in!Africa!The!beer!frontier.![online]!Available!at:! http://www.economist.com/news/business/21602999?long?established?african?firm?went?global?only?find?fastest? growing?market?was?its![Accessed!11!Apr.!2017].! ! As!in!Asia,!AB!InBev!plans!to!introduce!some!of!its!major!brands!to!Africa,!such!as!Budweiser,!Stella! Artois!and!Corona.!The!plan!also!includes!exporting!African!beers!to!the!rest!of!the!world.!This!way,! AB!InBev!wants!to!sell!Castle!(South!Africa),!Hero!(Nigeria)!and!Kilimanjaro!(Tanzania)!outside!the! continent.³!All!three!brands!are!of!Lager?Pilsner!type!of!beer,!the!most!popular!and!adapted!type!of! beer!for!the!African!market.65 ! ! The!expansion!in!Africa!is!also!based!on!important!priorities.!This!means!some!divestments!with!the! sale!of!Distell!Group!Ltd.,!66 !a!South!African!drinks!maker,!but!also!the!sale!of!the!group’s!stake!in! Coca!Cola!Beverages!Africa!(SABCO)67 ,!a!bottling!company!made!of!a!partnership!between!Coca!Cola,! SABMiller!and!Gutsche!Family!Investments.!AB!InBev!has!a!comparable!partnership!with!PepsiCo!in! South!America.!AB!Inbev!however!chose!to!divest!the!soda!and!bottling!units!of!SABMiller!in!Africa! and! went! towards! continuing! other! engagements! of! the! company.! ! AB! InBev! will! maintain! the! regional! headquarters! for! Africa! in! Johannesburg! and! set! up! a! local! board.! Continue! a! scheme! started!by!SABMiller!in!2010!called!the!Zenzele!Broad?Based!Black!Economic!Empowerment!(BBBEE)! 68 ! which,! among! other! objectives,! aims! at! providing! economic! benefits! at! disadvantaged! South! Africans.!AB!InBev!also!announced!investments!such!as!a!new!plant!in!Nigeria!and!investments!in! two!new!production!lines!in!South!Africa.!³!Ricardo!Tadeu!talks!about!prioritizing!actions!in!Africa,! the!company!will!focus!on!the!countries!where!SABMiller!was!already!active,!keeping!in!mind!that! Heineken! NV,! their! rival! on! the! continent,! is! already! heavily! implemented! in! countries! such! as! Democratic!Republic!of!Congo!and!Ivory!Coast.!! ! There!are!several!reasons!why!the!African!market!is!quite!different!from!the!rest!of!the!world:!high! fixed!costs!of!breweries!due!to!expensive!water!treatment!and!power!access,!difficulty!of!access!to! 65 !Our!brands!|!AB!InBev.!(2017).!Ab?inbev.com.!Retrieved!20!April!2017,!from!http://www.ab?inbev.com/our?brands.html! 66 !Geller,!M.,!&!Dludla,!N.!(2016).!AB!InBev!to!sell!stake!in!South!Africa's!Distell!to!state!fund.!Reuters.!Retrieved!20!April!2017,!from! http://www.reuters.com/article/us?anheuser?busch?distell?grp?stake?sale?idUSKBN1440OK! 67 !Blenkinsop,!P.,!&!Geller,!M.!(2016).!Coke!moves!away!from!AB!InBev!with!Africa!bottling!deal.!Reuters.!Retrieved!20!April!2017,!from! http://www.reuters.com/article/us?anheuser?busch?m?a?coca?cola?bo?afric?idUSKBN14A0HJ! 68 !SAB!Zenzele!|!SAB.!Sab.co.za.!Retrieved!20!April!2017,!from!http://www.sab.co.za/the?sab?story/sab?zenzele/!
  21. 21. 21 remote! territories! and! bad! transportation! possibilities,! unstable! political! situations! in! various! countries,!poverty,!and!many!other!reasons.!5! ! Due!to!all!these!limitations,!the!beer!market!tends!to!be!governed!by!monopolies!in!each!country,! with!companies!owning!up!to!75%!of!the!market!share!of!beers!sold.!AB!InBev!will!most!likely!pursue! SABMiller’s!African!strategy!of!making!beer!affordable!to!local!customers.!Indeed,!it!can!take!several! hours!for!a!worker!to!buy!a!single!beer!and!SABMiller!has!made!efforts!to!reduce!this!price.!! ! Given!the!growth!of!GDP!and!middle?class!in!Africa,!AB!InBev!decided!to!take!the!challenge!of!facing! the!difficulties!that!can!occur!when!looking!at!risks!and!ease!of!doing!business!on!the!continent.! They!chose!to!merge!with!a!solid!competitor!to!adapt!to!the!market!with!the!acquired!knowledge!of! the!new!partnership.!This!is!strengthened!by!setting!up!a!local!board!in!headquarters!in!South!Africa.! Although!the!merger!was!quite!aggressive!in!terms!of!importance!and!transfers!of!business!units,! the! company! remains! careful! on! investments! and! chooses! to! keep! SABMiller’s! method! on! the! continent.! ! To! assure! itself! a! strong! position! on! the! African! market,! considering! all! the! information! above,! investing!in!safe!and!strong!brands!that!are!sold!in!multiple!countries!such!as!Hero!and!Castel!seems! to!be!the!best!recommendation.!This!way!AB!InBev!can!make!use!of!SABMiller’s!expertise!and!grow! in!volume.!As!explained!before,!the!African!customer!is!used!to!lager!types!of!beers!so!this!choice! seems!to!be!the!best!strategy!on!a!short!term.!But!as!middle!class!expands!and!power!purchase! grows,!the!maturity!of!the!beer!culture!can!change,!and!AB!InBev!should!start!trying!out!with!smaller! breweries!to!include!other!types!of!beer!in!their!portfolio!in!the!future.! ! 4. CONCLUSION ! AB!InBev!was!already!the!leader!in!the!beer!industry!and!merging!with!SABMiller!only!comforted! their!position!by!isolating!competitors!such!as!Heineken!and!Carlsberg!to!large!difference!in!scale.! The! deal! made! them! achieve! the! objective! of! “Building! the! first! truly! global! beer! company”! and! strengthened! the! consolidation! advantages! of! having! a! large! company! by! cutting! costs! and! developing! synergies.! The! acquisition! of! SABMiller! is! of! course! impressive! in! terms! of! size! and! important!concerning! the! future! of! the! beer! industry! and! the! strategy! of!AB!InBev,!but!it!is!also! totally!coherent!with!the!company’s!“Think!Global,!Act!Local”!strategy,!giving!them!multiple!new! portfolios!of!brands!and!breweries!on!markets!where!they!had!very!limited!access.!Both!African!and! Asian!markets!offer!new!challenges,!although!very!different!when!looking!at!the!specifications!of! each!market.!Asia!is!a!more!mature!market!where!AB!InBev!will!develop!premiumization!of!their! portfolios!and!work!on!different!strategies!for!each!region.!The!African!market!will!be!more!about! developing!growing!brands!in!terms!of!volume!but!also!in!terms!of!exports!to!the!rest!of!the!world.! Although!mergers!and!acquisitions!are!a!fundamental!component!of!AB!InBev’s!history,!this!time!it! has!had!an!impact!on!global!strategic!choices.!The!company!is!now!clearly!the!world!leader!in!the! industry!but!to!do!so,!they!left!important!brands!behind!and!loosened!their!hold!on!some!other! markets! such! as! North! America! and! Europe.! AB! InBev! decided! to! take! a! bet! on! new! market! opportunities,!letting!other!merging!opportunities!to!competitors!and!making!the!beer!industry!an! interesting!competitive!market.!Was!this!the!right!choice?!Only!the!future!will!tell.!
  22. 22. 22 5. BIBLIOGRAPHY ! AB! InBev,! (2016).! Introductory! presentation.! Retrieved! April! 24,! 2017,! from! http://www.ab? inbev.com/content/dam/universaltemplate/abinbev/pdf/investors/15January2016/Anheuser? Busch%20InBev%20–%20Roadshow%20–%20January%202016.pdf! ! Allen! J.,! Zook! C.! (2012)! The! strategic! principles! of! repeatability.! Retrieved! April! 4,! 2017,! from! http://www.bain.com/publications/articles/the?strategic?principles?of?repeatability.aspx! ! AmBev! Agrees! to! Merge! with! Interbrew.! (2017)! Bloomberg.com.! Retrieved! 7! April! 2017,! from! https://www.bloomberg.com/news/articles/2004?03?02/ambev?agrees?to?merge?with?interbrew! ! Anheuser?Busch! InBev! ADR.! (n.d.).! Retrieved! April! 24,! 2017,! from! http://www.boursier.com/actions/actualites/news/anheuser?busch?inbev?adr? US03524A1088,US.html! ! Beer! monster.! (2015,! September! 19).! Retrieved! April! 24,! 2017,! from! http://www.economist.com/news/business/21665074?ab?inbev?may?combine?sabmiller?flat? market?big?beer?brands?beer?monster! ! Blenkinsop,! P.,! &! Geller,! M.! (2016).! Coke! moves! away! from! AB! InBev! with! Africa! bottling! deal.! Reuters.! Retrieved! 20! April! 2017,! from! http://www.reuters.com/article/us?anheuser?busch?m?a? coca?cola?bo?afric?idUSKBN14A0HJ! ! Bray,!C.!(2016,!July!29).!Anheuser?Busch!InBev!Merger!With!SABMiller!Advances.!Retrieved!April!4,! 2017,! from! https://www.nytimes.com/2016/07/30/business/dealbook/china?beer?anheuser?busch? inbev?sabmiller.html?_r=0! ! Bray,!C.!(2016,!September!27).!Merger!of!Anheuser?Busch!InBev!and!SABMiller!Faces!Final!Hurdle.! Retrieved!April!8,!2017,!from!https://www.nytimes.com/2016/09/28/business/dealbook/merger?of? anheuser?busch?inbev?and?sabmiller?faces?final?hurdle.html?_r=0! ! Buckley,! T.! (2016,! September! 28).! Anheuser?Busch! InBev! Clinches! $103! Billion! SABMiller! Deal.! Retrieved! April! 24,! 2017,! from! https://www.bloomberg.com/news/articles/2016?09?28/sabmiller? investors?give?go?ahead?for?103?billion?megabrew?deal! ! Building!the!First!Truly!Global!Beer!Company.!(2015).! ! Burg,!D.!(2013,!November!22).!Heineken,!ses!trois!recettes!pour!abreuver!le!monde.!Retrieved!April! 4,! 2017,! from! https://business.lesechos.fr/directions?generales/strategie/developpement? international/0203138681422?heineken?ses?trois?recettes?pour?abreuver?le?monde? 57157.php?LHy2YrfrH5wsiblX.99! ! Calmé,!I.,!&!Polge,!M.!(2015).!11!cas!de!stratégie:!études!de!cas!d'entreprises!avec!corrigés!détaillés.! Paris:!Dunod! ! Cendrowski,!S.!(2017).!AB!InBev:!Budweiser’s!Owner!Is!China’s!New!Craft!Beer!Bully.!Fortune.com.! Retrieved!16!April!2017,!from!http://fortune.com/2017/03/16/china?craft?beer?ab?inbev/! ! Cioletti,! J.! (2015).! A! new! global! giant! is! born.! Retrieved! 7! April! 2017! from! http://web.b.ebscohost.com/ehost/detail/detail?sid=d53b2f3b?8725?4b21?a8d4?
  23. 23. 23 46f40e491d51%40sessionmgr103&vid=0&hid=116&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3d%3d#AN =12814222&db=buh! ! Cordes,! R.! (2004).! Interbrew! buys! Brazilian! brewer.! Retieved! 7! April! 2017,! from! http://search.proquest.com/docview/220351451?pq?origsite=summon! ! Financial!Times.!(n.d.).!Retrieved!April!8,!2017,!from!https://www.ft.com/content/1aada18a?c1da? 11e1?8e7c?00144feabdc0! ! Geller,!M.,!&!Dludla,!N.!(2016).!AB!InBev!to!sell!stake!in!South!Africa's!Distell!to!state!fund.!Reuters.! Retrieved!20!April!2017,!from!http://www.reuters.com/article/us?anheuser?busch?distell?grp?stake? sale?idUSKBN1440OK! ! Global! Beer! Consumption! Statistics! and! Trends.! (n.d.).! Retrieved! April! 7,! 2017,! from! http://visual.ly/global?beer?consumption?statistics?and?trends! ! Great!spectaculations.!(2014).!Anheuser?Busch!InBev:!What!The!SABMiller!Acquisition!Could!Mean.! Retrieved! ! from! https://www.forbes.com/sites/greatspeculations/2014/09/18/anheuser?busch? inbev?what?the?sabmiller?acquisition?could?mean/#1c4caea23c49! ! Great!Speculations.!(2017).!China!Is!Key!To!AB!InBev's!Asia!Growth!Prospects.!Forbes.com.!Retrieved! 3!April!2017,!from!https://www.forbes.com/sites/greatspeculations/2015/01/16/china?is?key?to?ab? inbevs?asia?growth?prospects/#7b3326472df2! ! Heimer,!M.!(2017).!Why!the!Craft!Beer!Battle!Just!Moved!to!China.!Fortune.com.!Retrieved!1!April! 2017,!from!http://fortune.com/2017/03/16/craft?beer?china/! ! I.!(2013,!June!04).!Anheuser?Busch!InBev!a!finalisé!l'acquisition!de!Grupo!Modelo.!Retrieved!April!7,! 2017,! from! https://investir.lesechos.fr/actions/actualites/anheuser?busch?inbev?a?finalise?l? acquisition?de?grupo?modelo?885299.php#bQVsVz1GfaWHdC7s.99! ! Interbrew! buys! AmBev! and! becomes! world! number! one.! Retrieved! 6! April! 2017,! from! http://www.beveragedaily.com/Manufacturers/Interbrew?buys?AmBev?and?becomes?world? number?one.! ! Jingxi,!X.!(2017).!AB!InBev!optimistic!about!growth.!Chinadaily.com.cn.!Retrieved!1!April!2017,!from! http://www.chinadaily.com.cn/business/2017?01/14/content_27952858.htm! ! Kew,! J.,! &! Prinsloo,! L.! (2017).! AB! InBev! to! Wring! Potential! From! Africa! Beer! With! Exports.! Bloomberg.com.! Retrieved! 20! April! 2017,! from! https://www.bloomberg.com/news/articles/2017? 04?12/ab?inbev?sees?africa?as?two?way?street?for?boosting?beer?brands! ! Kirin!Beer!University!Report!Global!Beer!Consumption!by!Country!in!2014!|!News!Releases!|!Kirin! Holdings.! (2015).! Kirinholdings.co.jp.! Retrieved! 20! April! 2017,! from! http://www.kirinholdings.co.jp/english/news/2015/1224_01.html! ! Kitwe,!&!Onitsha.!(2014).!SABMiller!in!Africa!The!beer!frontier.!Economist.com.!Retrieved!20!April! 2017,! from! http://www.economist.com/news/business/21602999?long?established?african?firm? went?global?only?find?fastest?growing?market?was?its! !
  24. 24. 24 Martin,! W.! (2017).!Heineken! is! taking! tips! on! how! to! sell! beer! from! an! American! craft! brewer.!Business! Insider.! Retrieved! 04! April! 2017,! from! http://uk.businessinsider.com/interview? with?heineken?cfo?laurence?debroux?on?its?partnership?with?lagunitas?2016?2! ! Merced,!M.!J.!(2008,!July!13).!Anheuser?Busch!Agrees!to!Be!Sold!to!InBev.!Retrieved!April!7,!2017,! from!http://www.nytimes.com/2008/07/14/business/worldbusiness/14beer.html! ! Our! team! |! AB! InBev.! (2017).! Ab?inbev.com.! Retrieved! 20! April! 2017,! from! http://www.ab? inbev.com/our?story/our?team.html! Point,!M.!L.!(n.d.).!Archives.!Retrieved!April!9,!2017,!from!http://www.lepoint.fr/actualites/2008?07? 14/inbev?rachete?anheuser?busch?pour?52?milliards?de?dollars/1037/0/260350! ! Rissingh,! D.! (2017).! Interbrew! and! AmBev! merge! to! create! biggest! brewer.! Telegraph.co.uk.! Retrieved!7!April!2017,!from!http://telegraph.co.uk/finance/2878842/Interbrew?and?AmBev?merge? to?create?biggest?brewer.html!! ! SAB! Zenzele! |! SAB.! Sab.co.za.! Retrieved! 20! April! 2017,! from! http://www.sab.co.za/the?sab? story/sab?zenzele/! ! Smith,!S.!(2017).!Interbrew!Said!to!Be!Near!Deal!for!Brazil!Brewer.!Nytimes.com.!Retrieved!7!April! 2017,! from! http://www.nytimes.com/2004/03/02/business/interbrew?said?to?be?near?deal?for? brazil?brewer.html?_r=0! ! Staley,!G.!(2015).!Asia!Pacific.!1st!ed.!Boston.! ! Vipul!Sonavane,!Business!Analyst!at!HSBC!Follow.!(2013,!October!29).!Ab!inbev!m&a.!Retrieved!April! 24,!2017,!from!https://www.slideshare.net/VipulSonavane/ab?inbev?ma?team?4! ! !
  25. 25. 25 6. APPENDIX ! 6.1. 10 Principles
  26. 26. 26 6.2. World Beer Industry (% of Volume, 2014) 6.3. Consumer’s Classes Evolution Forcasts America! 31%! Europe! 27%! Africa!&!! Middle!East! 7%! China! 23%! Rest!Asia!Pacific! 12%! Asia!Pacific! [PERCENTAGE]!
  27. 27. 27 6.4. Consumption Per Capita (20 largest provinces in term of liters of beer) 6.5. Segment Comparison
  28. 28. 28 6.6. Consumption vs GDP (Per capita, thousand of USD and liters) ! !

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