SABMiller has not yet entered Brazilian market because it believes assets are overpriced in the country, executive says
November 15, 2011
– U.K.’s SABMiller PLC has not entered the Brazilian market yet because it believes assets are overpriced in the country, Valor Economico reported Nov. 11.
Karl Lippert, the company’s CEO for Latin America, cited problems such as corruption and political instability, a complex taxing system, growing environmental requirements and lack of infrastructure. Therefore, he said, investments in Brazil must offer a higher return.
SABMiller has already invested in seven other Latin-American countries --Argentina, Colombia, Peru, Ecuador, Honduras, El Salvador and Panama -- and it has previously considered takeover bids for Mexico’s Fomento Economico Mexicano SAB de CV and Brazilian brewer Schincariol.
SABMiller’s latest investment in Latin America was in Argentina, where it acquired local brewer C.A.S.A. Isenbeck for US$38 million in 2010. The deal secured the company with a cheap source of cereals and enabled it to export to Brazil, Uruguay, Paraguay and Chile.
The primary source of this article is Valor Online, Sao Paulo, Brazil, on Nov. 11, 2011.