Johannesburg - Anheuser-Busch InBev NV agreed to create a R1bn ($69m) fund that will support the South African beer industry and protect jobs in the country to smooth approval for its proposed $105bn takeover of SABMiller.
The deal struck between the Budweiser maker and the South African government includes a pledge to preserve its full-time employment levels in the country for five years after the deal closes and to not make any involuntary job cuts, Leuven, Belgium-based AB InBev said in a statement on Thursday. It also includes financial help for new farms to produce raw materials like hops and barley for the combined company.
“This transaction is by far the largest yet to be considered by the competition authorities and it’s important that South Africans know that the takeover of a local iconic company will bring tangible benefits,” the country’s Economic Development Minister Ebrahim Patel said in the statement. “Jobs and inclusive growth are the central concerns in our economy.”
South Africa is just one of the countries where AB InBev is battling regulatory authorities in an effort to combine the world’s two biggest brewers. The company has also agreed to retain a secondary listing on the Johannesburg Stock Exchange and locate its Africa office in the city. SABMiller, which started selling beer to gold miners in Johannesburg in 1895, controls 90% of South Africa’s market.
Other commitments include work to reduce the harmful use of alcohol and support for South Africa’s empowerment policies, which aim to redress inequality caused by apartheid.