Latin America: AmBev brews expansion
Merger with Belgium's InterBrew last year helped catapult the Brazilian company to the top of the beer industry. But, as Leticia Lozano reports, the emphasis now is on growth closer to home.
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BRAZIL'S BRAHMA BEER brand went global in 15 countries earlier this year, with its maker trusting that a sense of Brazilian ginga, or effortless flair, would prove to be its selling point. Companhia de Bebidas das Américas (AmBev) marketers expect that spontaneity and a South American sense of the exotic, not to mention a hint of papaya, will guarantee that Brahhma appeals to men and women alike. It is that sense of flair that has made AmBev one of a handful of Latin American companies to have achieved growth through acquisitions in the developed world. The benefits appear to be paying off.
Last August, AmBev merged with Belgium's Interbrew in an $11.2 billion deal to create InBev, the world's biggest brewer by volume – a move that will eventually take AmBev's Brahma brand to 23 countries. It helped catapult AmBev to the top of the beer industry, as InBev produces about 14% of the world's beer by volume. The deal also involved AmBev acquiring Canada's Labatt – a smart play, many bankers argue, because it allows AmBev to invest its huge cashflow, driven by strong growth in Brazil, in a North American asset rather than handing it back to shareholders.