Colombia: InBev NV, the world's largest brewer by sales volumes, has the most to gain from buying Colombia's Bavaria Business Group because South America's No. 2 beer-maker would complement the $11.2 billion acquisition InBev made in Latin America last year, ING Groep NV analysts said on January 28. According to Bloomberg, SABMiller Plc, the world's second-biggest brewer by sales volumes, is the frontrunner to buy Bavaria because it wants to catch up with Leuven, Belgium-based InBev in size, people familiar with the negotiations to sell the Bogota-based company have said.

A new owner of Bavaria would gain a company that dominates the beer markets of Colombia, Peru, Ecuador and Panama and has a 12.5 percent share in Latin America, according to ING. InBev in August wrapped up its purchase of Cia. de Bebidas das Americas, or AmBev, Latin America's biggest brewer with a 67% share of the Brazilian market, Bloomberg revealed.

It is unlikely that InBev would not be interested'' in Bavaria, Gerard Rijk, an ING analyst in Amsterdam with a ``hold'' rating on the stock, wrote in the report, which was distributed yesterday. “InBev could probably achieve the most synergies and could possibly pay a higher takeover price, and letting SABMiller or Heineken in would lead to an increase in competition.''

Chief Executive John Brock, 56, played down the possibility of a bid for Bavaria at the opening of InBev's new headquarters on Jan. 25, saying “there are other people out there who are more interested.'' SABMiller spokesman Nigel Fairbrass declined to comment on the ING report and Marianne Amssoms, a spokeswoman for InBev, didn't immediately respond to mobile-phone voicemails seeking comment.

The Belgian brewer of Stella Artois and Rolling Rock did hold talks about a possible offer for Bavaria, the people familiar with the matter said last week. AmBev later said it was not in discussions to buy Bavaria.

Shares of InBev climbed 1 cent to 27.91 euros at 9:57 a.m. in Brussels, while stock in London-based SABMiller fell 2 pence to 808 pence in the U.K. capital. Shares of SABMiller have risen almost twice as InBev's stock in the last 12 months, gaining 50 percent, compared to 29 percent for the company's Belgian rival.

With businesses in Latin America stretching from Guatemala to Argentina, InBev is trying to extend its reach beyond Brazil, where it accounts for about 70 % of beer sales. Brock also has steered InBev into acquisitions in Eastern Europe and China to make up for lackluster demand in western Europe, where its beer volumes fell 2.3 percent in 2004. Brewers including InBev, St. Louis-based Anheuser-Busch Cos., the world's biggest beermaker, and Carlsberg A/S have spent $67 billion on more than 400 acquisitions in the past five years to counter slower growth in beer consumption in their home countries, data compiled by Bloomberg show.

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