China Granted Conditioned Approval to Inbev’s Takeover of Anheuser Busch

Since the PRC Anti-monopoly Law came into effect on August 1, 2008, the Anti-Monopoly Bureau (“AMB”) under the Ministry of Commerce (“MOFCOM”) has received over 10 applications for antitrust review of concentration of business operators. According to MOFCOM, 13 of such applications have been formally accepted, eight of which have been granted decisions. One of the most widely reported examples is the Belgian brewer Inbev’s $52 billion takeover of Anheuser Busch Inc. (“AB”).

This takeover is reported to be subject to antitrust reviews in three jurisdictions, i.e., Belgium, U.S. and China where both parties have their respective strong market positions.

The AMB of China approved the proposed takeover, but imposed the following four conditions on the new company’s post-takeover investment in China:

- it shall not increase AB’s current 27% shareholding in Tsingtao Brewery;
- it shall not increase Inbev’s current 28.56% shareholding in Zhujiang Brewery;
- it shall not seek to hold any stake in China Resources Snow Brewery or Beijing Yanjing Brewery; and
- it shall notify MOFCOM if there are any changes to its controlling shareholders or the shareholders of such controlling shareholders.

Inbev must report to MOFCOM and obtain its approval before implementing any change to the above conditions.