Could Japan Merger Create the Godzilla of Beers?
The United States has Budweiser, the self-proclaimed King of Beers. Could Japan soon have a Godzilla of Beers? Suntory has confirmed that it is considering a merger with Kirin, the country’s biggest beer maker. The resulting monster would have a dominant position in the beer market in Japan, and might even do some damage to competitors overseas. But, Breakingviews.com says, Kirin and Suntory already share one thing: an overreliance on Japan. Along with rivals Asahi and Sapporo, they’re chasing a revenue pool that is expected to decline by at least 3 percent this year. High taxes contribute to low operating profit margins, which according to Moody’s is 5.4 percent at the privately held Suntory. That’s a quarter of the level at Anheuser-Busch InBev, which owns Budweiser, Breakingviews.com notes. Crunching together Kirin and Suntory will not make the Japanese drink more beer, but a more concentrated market should be more profitable, the publication says. The idea of shutting down any of S
