Beer market of Russia 2016: PET goes to draftThe beer market of Russia was warmed up by the hot summer, but the preparation for large volume PET prohibition has already impacted it negatively. The year was successful for Efes, MBC and regional producers; Carlsberg’s positions were virtually stable but AB InBev and Heineken lost a part of market share having focused on the sales profitability. The dynamics of big brands was determined by how much the companies were willing to keep the prices down or by their promotional activity. In this context the economy segment of the beer market and sales of inexpensive draft beer were increasing. The premium segment started shrinking due to license brands migrating to the mainstream segment.
Beer market of Vietnam: “Young tiger”Vietnam is one of the few big beer markets that continue to grow steadily. The beer popularity results from its low price, street consumption culture, and social motives. The outlooks of beer market as well as the Vietnamese economy inspire optimism, though the country is heavily dependent on export of goods. The state regulation can be called liberal, but the key risk for brewers is harbored in intensive rising of excise. Within TOP-4 there are two leaders, Sabeco and Heineken that grow at the fastest rates. The first company effectively employs its capacities, the second one focuses on marketing technologies. Almost 80% of the market belongs to century-old brands, yet the middle class and the youth are shifting their interest toward international premium that is growing taking share from the mainstream.
Analysis of beer market in China (on Russian)
Beer market of Ukraine: big three losing weightIn 2016, fast increase of excises and resulting price spike stood in the way of the beer market stabilization. Most of competition (as well as mass sorts) moved to the economy segment of the market. The biggest losses were incurred by the leading three, especially Obolon, which again experienced pressure after reallocation of Efes market share. However, one should already speak of TOP-4. Group Oasis CIS (PPB) became a strong player and competitor to transnational companies. Besides the net sales of many regional medium breweries look rather good and 16-fold cost reduction wholesale trade license for craft brewers opens up a possibility of rapid growth in 2017.
SABMiller plc To Bid On Brewer
Canada's thwarting of BHP Billiton's $39-billion hostile bid for PotashCorp last year was a setback for big companies looking for acquisitions.
Before that bid, five large cross-border mining deals had already been rejected by regulators or governments, according to the Financial Times.
Competition authorities around the world have started to crack down, especially in Europe.
"It's becoming more and more difficult to get regulatory approval for the really big transactions," said Leon von Moltke, head of debt restructuring at RMB.
But Rob Forsyth, head of industrials at Investec Asset Management, said: "With SABMiller and AB InBev there isn't much in-market overlap.
"Beer is all about branding and marketing."
Forsyth said marrying the cost-cutting culture of AB InBev with SAB's marketing would be advantageous.
In 10 years, rapid consolidation resulted in the top four breweries - AB InBev, SABMiller, Heineken and Carlsberg - accounting for nearly half the world's beer sales.
Brewery deals have totalled $141.9-billion in five years, and the opportunities for more consolidation among the big players looks limited, though executives expect acquisitions to continue as global brewers expand.
Organic volume growth is expected to come from developing markets. Emerging markets have grown at 6.8% in five years while developed markets dropped to 3.4%. The biggest growth is in China, Africa and Eastern Europe.
About 80% of SABMiller's sales and profits come from emerging markets.
AB InBev is bigger than SABMiller in terms of volumes brewed (348-million hectolitres versus 244-million hectolitres) and market capitalisation ($87-billion against SABMiller's $54-billion).
A merged group would produce one-third of the world's beer, combining brands such as AB InBev's Budweiser and Stella Artois with SABMiller's Castle, Miller Lite and Peroni.
There is surprisingly little overlap between the two, apart from in the US, which would present a problem.
The combined group would have nearly 80% of the market in the US, but SABMiller would have to sell its 58% stake in MillerCoors in the US.
Analysts are divided about the possibility of a merger, and no one sees it happening soon.
Four years ago, InBev directors met their SABMiller counterparts but no deal materialised. At the time InBev balked at the prospect of having to pay a premium to the SABMiller share price - which has since doubled.
Traditionally, big deals have been about willing sellers and buyers. But national interest is a growing factor and the government has become protective of SA-founded assets. The Department of Trade and Industry wants the Competition Commission to block Kansai Paint of Japan's hostile takeover of Freeworld Coatings. And various departments have become involved in Walmart's buyout of Massmart.
4 Apr. 2011