AB-InBev Expanding in China


Anheuser-Busch InBev has strengthened its grip on China's Henan province by signing a deal to acquire Weixue Beer Group Co for an undisclosed fee.

A-B InBev has agreed to acquire Henan-based Weixue, including its namesake brand and three breweries, in Xinyang, Zhengzhou and Gushi.

The move marks the Budweiser brewer's second acquisition deal in China within a month and demonstrates that the country's emerging beer market remains a key focus for the group.

"This deal is part of our plan to strengthen our presence in Henan province and to secure a strong foothold in the south of Henan, while increasing share in the north," said an A-B InBev spokesperson. The deal is subject to regulatory approval.

A-B InBev also plans to build a greenfield brewery in Xinxiang, Henan.

"Henan province is one of the largest China beer market with one of the fastest beer consumption growth rates," the spokesperson said. "It’s also the largest in terms of population and therefore an attractive and strategically important region for A-B InBev China."

Following InBev's $52bn takeover of Anheuser-Busch in late 2008, the newly-formed A-B InBev sold off its 27% stake in China's Tsingtao Brewery in order to build its business independently in the country. It currently has 33 breweries across 13 provinces, with 25 brands, including Budweiser, Harbin and Sedrin.

The Weixue beer brand is positioned in the value category, rather than premium, but it is strong in its local market, according to A-B InBev.

Last month, A-B InBev signed a deal to acquire full control of the Liaoning Dalian Daxue Brewery Co in China's Liaoning province, the country's fourth largest in terms of beer consumption.