Pro Analysis

Breakingviews: The race is on to be the SABMiller of food

Kraft and Heinz products
Scott Olson | Getty Images
Kraft and Heinz products

As millennials became old enough to hang out in bars some 15 years ago, the likes of Budweiser and Miller started to taste flat. Fancier drinks and craft beers cut into the brewing giants' market shares. A gusher of mergers followed, culminating in last year's $103 billion acquisition of SABMiller by Anheuser-Busch InBev. Kraft Heinz's $143 billion bid for Unilever last week, although quickly aborted, is a sign that millennials' attention, and the potential for M&A, have shifted to the food industry.

There's another connection, too. The beer push was initiated in Latin America by Jorge Lemann, a founder of private-equity firm 3G Capital – the same group that's behind Kraft Heinz, alongside Warren Buffett's Berkshire Hathaway. Lemann's Brazil-based brewer Ambev then merged with Belgium's Interbrew in 2004. It went on to down Anheuser-Busch, becoming AB InBev, and Mexico's Modelo.