SABMillerwins support to buy Fosters Group Australia's largest brewer according to the LA Times article. According to what I have read it was a bit of a hard sell, but in the end it looks like it may go through as planned. If it does, SAB Miller will now have access to half of Australians beer distribution.
Having spent time in Australia back in 1984, I can tell you at that time they had a law which restricted beer sellers from selling beer made in one province being sold in another. Australia has 7 provinces or states. If things haven't changed then that's why Fosters will give SABMiller access to half of the Australian beer market.
So just why does a mega company like SAB Miller wish to buy out another rival beer company? Aren't they satisfied with what they already own and manage? Nope they aren't, its called world dominance. By owning half of the Ausi market SAB will have a chance to bring in their own products into the distribution chain to sell to current and potential beer drinkers.
More selection more sales is one reason companies buy out their competitor. The other less obvious is access to their former competitors distribution channels, which in some cases are more valuable than the products being sold through them.
Distribution is a huge topic which requires another treatment, lets just say one of the biggest reasons why corps buy out other corps is because of the valuable infrastructure they gain not just the brand name everyone recognizes. Thats called being shrewd.
Something we can all tip a cold one over.
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