SABMiller

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SABMiller

Location	London, United Kingdom
Year opened	2002
Annual production	184 million hectolitres
Active Beers
Pilsner Urquell	Pilsner
South African Breweries	Subsidiary
Miller Brewing Company	Subsidiary
Bavaria S.A.	Subsidiary

SABMiller (LSE: SAB) is the second largest brewery company in the world by volume, after InBev. The company was formed in 2002 by the merger of South African Breweries and Miller Brewing.

As brewing is an industry with very large returns to scale, most markets have a profitable dominant brewer, a few marginally profitable secondary brewers, and imports from the dominant brewers in other areas. SABMiller's areas of dominance are Africa, North America and Eastern Europe. However, the company is headquartered in London, where it has a comparatively small market share and does not brew any of its own beers. It is traded on the London Stock Exchange and is a constituent of the FTSE 100 Index.

In July 2005, SABMiller announced that it had agreed to acquire Bavaria S.A., a Colombian brewer with a dominant market position in its home country, Peru, Ecuador and Panama. It is the second largest brewer in South America overall with 2004 revenues of over $2 billion. Bavaria was 70% owned by the Santo Domingo family, which exchanged its holding for new shares in SABMiller, giving it a stake of between 15% and 20%, and making it the second largest shareholder. The value of the stake has been reported by The New York Times to be $3.8 billion, though this fluctuates from day to day according to SABMiller's share price. SABMiller also assumed 4.9 billion Colombian pesos (approximately $2.2 billion) of debt.