Well, it seems it might be, but rumour has it that it’s not! Here’s what’s been circulating around these past few days:
The Guardian newspaper reports that Matrix Corporate Capital analysts recently met with executives from Diageo and found that the minds behind the largest drinks company in the world are not necessarily opposed to the idea of merging with a greater force in the beer biz, like Heineken, SABMiller or even the headline-mentioned ABIB.
Diageo’s reaction to comments suggesting that perhaps a merger with SABMiller or Heineken could pre-empt action by ABIB suggested to the analysts that they have a “genuine openness to corporate action.” This left the Matrix side of the table with the impression that “Diageo’s door is open to a deal.”
And not just a deal with SABMiller or Heineken, either! The analysts also reported that “Diageo was much more open to (a deal with ABIB) than we had anticipated,” although noted that the general consensus at the table was that SABMiller would be the most logical next target for the brewing behemoth.
So, ABIB could merge with SABMiller and grow even more massive, likely first selling off their joint venture business in the U.S., MillerCoors, to the other half of that team, MolsonCoors. Which would make the last company, what?, MolsonMillerCoors? And ABIB would become SABABIB?
But wait, that’s not all! Speaking with another contact today, I found that there is speculation in the financial world not that ABIB would take over SABMiller, but that SABMiller would swallow the larger brewing company. And if not SABMiller, then some other company, as financial circles appear to be chewing over the idea that the world’s largest brewing company is being cut, trimmed and primed for a sell-off.
All of which means, well, what exactly? I’m no expert, but if you ask me it demonstrates that the big brewers have all but given up on restoring the lustre to their flagship brands in existing markets and settled on the way forward as either exploiting underdeveloped companies or buying or merging with other existing brewers to add to market share.
Or in other words, as I noted back here, don’t expect the big North American beer brands to bounce back any time real soon.