By Andy Young

Anheuser-Busch InBev will establish a one billion rand (AU$89 million) fund to support small South African farmers and the local beer industry as part of its bid to win regulatory approval for its planned takeover of SABMiller.

The brewer has also said that it will implement a five-year freeze on any involuntary job losses in the deal it agreed with the South African Ministry of Economic Development.

The fund will be used to help finance barley, hops and malt farmers who supply SABMiller.

In a statement about the deal AB InBev said: "It is expected that the agreement on terms between government and the merger parties will expedite the merger proceedings before the South African competition authorities.”

Last week South African regulators investigating the proposed takeover sought an extension to their review, citing “concerns” with the deal. The merging parties were made aware of those concerns and this agreement is seen as a major step forward in gaining regulatory approval in South Africa.

South Africa’s economic development minister Ebrahim Patel said: "The commitments made by the company are the most extensive merger-specific undertakings made to date in a large merger. In our view, they meet the requirements of the competition legislation. The agreed terms will be placed before the competition authorities for consideration.”

SABMiller is a major employer in South Africa, with more than 9000 workers and analysts close to the deal have said that gaining approval in the country was one of the major obstacles to the takeover.

AB InBev has already agreed to sell SABMiller brands in the US, Europe and China as it seeks approval for the acquisition around the world and earlier this week the European Commission said it would announce the findings of its review at the end of May.

The Shout Team

The leading online news service for Australia's beer, wine, spirits and hospitality industries.

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