Drinks

Brew Masters of the Universe

The biggest beer brand in the world now belongs to China
Snow Beer
Photo: Alpha via Flickr

AB InBev, the biggest beer company in the world, just sold the best-selling beer in the world to China. The brew in question: Snow beer, a lager sold in China that you may not have heard of, even though it's been the world's top-selling beer since it pushed aside Bud Light in 2008.

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Yes, the best-selling beer in the world is Chinese, and, yes, the country consumes the most beer in the world by volume. Still, China remains the second most profitable market after the United States, in part because a large supply has driven prices down. A liter of beer in China costs only $1.45, where the comparable 40-ounce bottle in the U.S. sells for an average cost of $4.10. Profits are low, too, because Chinese drinkers are increasingly turning to wine and spirits, the Wall Street Journal reports.

SABMiller sold its 49 percent stake of China's Snow beer to state-backed China Resources Beer (CRB) for a cool $1.6 billion. According to the Wall Street Journal, the sale makes CRB the largest beer company in China.

The sale of Snow beer is the latest move in the pending merger of beer giants AB InBev and SABMiller. AB InBev announced a deal to acquire SABMiller in November for $106 billion, which would make it the world's biggest brew company. USA Today reports that the company made the Snow beer sale in an effort to soothe concerns surrounding the deal, which must meet regulatory approval from countries across the globe.

AB InBev's latest sale will allow the company to focus on more expensive craft beers with a higher profit margin in China—a potential win for the Belgium-based company. For China, the sale pushes CRB into the global market. Everything still hinges on the approval of AB InBev and SABMiller's union however, so you may want to crack a cold one while you wait for it all to play out.

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