* Asia main area with assets left to buy, but expensive
AB InBev, SABMiller merger would combine Latam, Africa growth markets
* SABMiller price tag would likely be more than $100 bln
By Philip Blenkinsop and Martinne Geller
BRUSSELS/LONDON, Oct 28 (Reuters) - With half the world's beer produced by four big firms and few markets left for them to tap, the time may be right for a $100 billion merger between the two largest, Anheuser-Busch InBev and SABMiller .
This mega-deal is tipped by analysts as the most likely tie-up because of the other two, Heineken is family controlled and Carlsberg is protected by a trust.
Talk that AB InBev might buy SABMiller is not new, but it paused in June 2012 when the former announced a $20.1 billion deal to take over Mexican brewery Grupo Modelo.
Now, with AB InBev planning to return to a comfortable pre-deal debt-to-EBITDA ratio of below two next year, industry experts are betting on a combination of its Budweiser and Stella Artois brands with SABMiller's Peroni and Grolsch. Some expect a deal within a year.
"It's more a question of when, not if," said a banker who has worked on drinks deals. Others, also speaking on condition of anonymity, cited AB InBev's record as a serial acquirer and the need for a target to match or surpass its $52 billion purchase of Anheuser Busch in 2008.
AB InBev has grown from a small Belgian brewer, with roots dating back to 1366, into a powerhouse with 17 billion-dollar brands and a Brazilian-led management based in New York.
Under Chief Executive Carlos Brito, it is renowned for buying assets, aggressively cutting costs and swiftly moving on.
When it comes to the next target, many independent brewers are in Asia. But a large number are family or state-controlled, such as Thailand's ThaiBev or Vietnam's Sabeco, and unlikely to be had on the cheap. Heineken paid a mammoth 35 times trailing earnings for control of Asia Pacific Breweries Ltd last year.
While SABMiller won't be cheap either, analysts say a tie-up would be straightforward with antitrust issues relatively easy to fix and immediate benefits of scale.
"If you do a deal, say, with ThaiBev, it's not going to move the needle. If you do it with SAB it would give them another leg up," said Andrew Holland, beverage analyst at Societe Generale.
AB InBev and SABMiller declined to comment.
AB InBev is market leader in North America, Mexico and Brazil. SABMiller would give it smaller Latin American markets such as Colombia and Peru, as well as Africa, where SAB began selling beer in 1895 to Johannesburg prospectors used to drinking raw potato spirit mixed with tobacco juice and pepper.
The market overlap likely to upset regulators is in the United States and China, analysts say.
AB InBev has almost half of the U.S. market and would not be allowed to add SABMiller's quarter share, held through the MillerCoors joint venture with Molson Coors. Selling the Miller stake is the obvious fix, although Molson would be the only realistic buyer and so not forced to pay top dollar.
In China, regulators may be unhappy with a combination of SAB's joint venture with the brewer of market leader Snow and AB InBev's various brewing partnerships.
Soft drinks may also cause a hiccup, as AB InBev is the largest Pepsi bottler in Latin America and SABMiller is a big Coca-Cola bottler. A combined entity would have to pick sides.
Still, the key determinant for any deal is price. A SABMiller takeover, estimated at around $100 billion, would likely be the fifth-largest corporate acquisition ever.
Due to its presence in rapidly growing markets, SABMiller has a market value of $84.5 billion. Even off its May peaks, it is still 41 percent more expensive than at the start of 2012, when AB InBev was first reported to be interested.
The London-based brewer trades at a multiple of 20.2 times forecast earnings for the next 12 months, according to Reuters data, slightly higher than ABI's 19.9 and any other European beer, spirits or tobacco group.
AB InBev may want to move fast before SABMiller gets more expensive. Another consideration is the U.S. Federal Reserve's likely decision soon to scale back its bond-buying program - expected to lead to higher interest rates that would make the deal more expensive to finance.
SABMiller's two top shareholders - cigarette maker Altria Group and the Santo Domingo family of Colombia, which own 27 percent and 14 percent, respectively - "may think this is as good as it gets," said another banker.
Bankers also speculate that those owners may be willing to accept shares in a new, larger brewer and enable AB InBev to shoulder less debt. Altria did so in 2002 when SAB bought Miller, while the Santo Domingo family traded their Latin American Bavaria business for SABMiller stock.
Altria says it regularly evaluates the stake.
"Currently, we believe maintaining the investment is in the best interest of our shareholders," said an Altria spokesman.
A representative of the Santo Domingos could not be reached.
Alternatively, SABMiller could try to make itself too big to buy by taking over its African partner Castel Group or Turkey's Anadolu Efes, both of which it has stakes in.
SABMiller said at the start of 2012, just when AB InBev appeared on the prowl, that it was interested in buying Castel. It has first refusal should Castel decide to sell, although there is no evidence the Paris-based group wants out.
Other industry executives think it is shortsighted to limit AB InBev's and its rivals' ambitions to beer alone.
Speculation over whether AB InBev would buy PepsiCo's drink business, or at least part of it, has grown recently as activist investor Nelson Peltz pushes for PepsiCo to buy Cadbury chocolate maker Mondelez International, making it more likely that the drink business could be sold.
"ABI and SAB do have strategic alternatives to making further large acquisitions in beer," said S&P Capital IQ analyst Carl Short.