Adedapo Adesanya
By Adedapo Adesanya
The South African division of Anheuser-Busch InBev has cancelled a further 2.5 billion rand ($165 million) investment after the government banned alcohol sales for the third time to control a resurgence of coronavirus cases.
The move brings the amount of spending called off by South African Breweries (SAB) to 5 billion rand since the COVID-19 pandemic began to take off in the country 10 months ago.
SAB, the country’s biggest brewer, recently said it would challenge the prohibition in court, describing the government’s action as unconstitutional.
Recently, South Africa’s President, Mr Cyril Rampahosa banned alcohol sales as part of efforts to free up space in hospitals burdened with alcohol-related injuries for COVID-19 patients.
According to analysis, the ban put more than 165,000 people in South Africa out of work and about 30 per cent of breweries in the country have been forced to shut their doors permanently.
“Given the material impact that this third ban on the sale of alcohol has on our business, and the possibility of further bans, we have no choice but to halt these investments for the foreseeable future,” SAB’s vice president of finance, Mr Richard Rivett-Carnac, said in a statement.
The spending had been earmarked for upgrades of operating facilities, product innovation and new equipment at selected plants, the company said.
AB InBev, the world’s biggest brewer, acquired SAB as part of its takeover of SABMiller Plc in 2016. The South African company can trace its roots back to Johannesburg’s late 19th-century gold rush when it catered for thirsty miners.
Anheuser-Busch InBev SA/NV, a brewing company, engages in the production, distribution, and sale of beer, alcoholic beverages, and soft drinks worldwide.
It offers a portfolio of approximately 500 beer brands, which primarily include Budweiser, Corona, and Stella Artois; Beck’s, Hoegaarden, Leffe, and Michelob Ultra; and Aguila, Antarctica, Bud Light, Brahma, Cass, Castle, Castle Lite, Cristal, Harbin, Jupiler, Modelo Especial, Quilmes, Victoria, Sedrin, and Skol brands. The company was founded in 1366 and is headquartered in Leuven, Belgium.
SAB produces popular South African lagers Castle Lite, Hansa and Carling Black Label.
