The merger of Anheuser-Busch InBev (AB InBev) and SAB Beer in Vietnam is officially complete.
Following in the footsteps of the parent firm’s global merger in 2016, Vietnam’s Ministry of Industry and Trade approved the union of both companies’ local arms, which will operate as a single entity as of January 12.
Publication the Vietnam Investment Review, quoting an AB InBev press release, noted the merger would allow the global beer conglomerate ‘to increase production capacity as well as simplify resources in [sic] supply chain, logistics, and most importantly, market expansion.’
Media reports indicate AB InBev’s brewery in Binh Duong (a province to the north of Ho Chi Minh City) will produce Hoegaarden for domestic consumption and other beers for export. In contrast, SAB Beer’s brewery will brew Beck’s and Budweiser beer for the local market.
The AB InBev’s Binh Duong brewery was the firm’s first in Southeast Asia. Opened in 2015, the site has a production capacity of 100 million litres per year.
AB InBev’s strategy in Vietnam focuses on the mass premium segment. Their portfolio of beers like Hoegaarden and Budweiser are primarily marketed to a younger, urban audience, using advertising to associate their brands with live music and aspirational lifestyles.
AB InBev and SAB Beer Merge In Vietnam
While AB InBev’s market share lags behind local and foreign competitors alike, the merger signals the firm is stepping up their game locally.
Like Thai Beverage and Carlsberg, AB InBev wants a piece of Vietnam’s surging beer market, which saw consumption growth surge 29% year-on-year in 2019 to four billion litres of beer.