![#](https://e-malt.com/Images/left_top_corner16x200.gif) | E-Malt.com News article: South Africa: AB InBev’s takeover of SABMiller could face significant delay due to long approval process in South Africa![Brewery news](https://e-malt.com/Images/BeerBullet2.gif)
The megamerger between the world’s largest brewers, AB InBev and SABMiller Plc, could face a significant delay due to a long approval process in South Africa, The Times reported on January 28
The £71-billion deal has prompted scrutiny from regulators around the globe, but the focus has been on markets such as the US and China, where AB InBev and SAB both have significant interests and a merger could impact competition. This is not the case in South Africa, SAB’s home market, as AB InBev has virtually no presence in that market.
Nevertheless, securing approval for the deal from South African regulators is not going to be easy, according to Bernstein’s Trevor Stirling. The analyst told The Times that the country’s regulatory bodies might delay approval pending agreement on issues including employment, social and economic welfare and black empowerment. South Africa “may be the slowest process, likely taking a minimum of 12 months and potentially up to 18 months or longer before final clearance,” he said.
The approval process faces complications stemming from South Africa’s three-tier regulatory authority — the competition commission, the competition tribunal and the competition appeal court – which could force AB InBev to make certain concessions regarding the deal. Stirling gave an example with Walmart’s entry into the South African market through the purchase of a controlling stake in Massmart. The deal was initially recommended for approval without conditions, but, after opposition from the government and unions, the tribunal imposed conditions relating to redundancies, labour agreements and suppliers. It took 18 months for that deal to be finally approved by the competition appeal court.
03 February, 2016
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