Why Anheuser-Busch InBev Plans to Axe 6,600 Beer Jobs

sab miller ab inbev merger
The Belgium-based brewery has plans to save $1.4 billion as it acquires rival SABMiller.Luke Sharrett / Bloomberg / Getty Images

The world's largest beer company, Anheuser-Busch InBev announced how exactly it will acquire rival SABMiller, a deal both brewers agreed on back in October 2015, for $103 billion. In a 277-page recommendation (the merger still isn't finalized), the Belgium-based AB InBev detailed a timeline of transactions for shareholders, the closure of SABMiller headquarters, and how the resulting megabrewer would be structured. But one line in the 277-page recommendation is standing out: a potential reduction in 3 percent from the combined workforce. That seems like a mild cut, but of the roughly 220,000 employees, that means 6,600 people will be out of work.

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It's an expected result of any merger, increasing efficiency after all, but it stands as an emblem for why the craft beer world has so many fans. As the biggest brewer on the globe is closing offices and eliminating jobs — for an estimated $1.4 billion savings over three years — America's independent brewers are steadily adding jobs across the country. At last count, the Brewer's Association (craft beer's trade group) counted 424,000 jobs in the U.S. directly tied to independent brewers, with 115,000 of those gigs at breweries.

"I think it points to one reason beer lovers like supporting small, local, independent businesses," says Bart Watson, economist for the Brewers Association. "They're connected to specific communities in a way that large multinational companies can’t be."

Among the beverage titans, AB InBev is known as a particularly lean operation, despite its size and reach. Bloomberg has pointed out, however, that comparing the $1.4 billion savings relative to the SABMiller's revenue isn't nearly as advantageous as when it acquired Anheuser Busch in 2011 or Grupo Modelo in 2013. But a driving factor in the merger is SABMiller's foreign footholds throughout Asia and Africa that AB InBev lacked. So while SABMiller may be moving its offices from London to Leuven, Belgium, much of its international production and distribution will likely join the AB InBev organization without serious cuts.

The U.S. operations should see even less change. The company already held a 45 percent market share before the deal, so AB InBev has promised to sell off SABMiller brands (within North America) to appease Justice Department anti-trust regulators.

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