Plans of the AU$146 billion dollar takeover of SABMiller by Anheuser-Busch InBev might not find support with Australian market regulators who have long been sceptical of such a merger. According to the former chairman of the Australian Competition and Consumer Commission, Allen Fels, the merger would decrease competition in the market to a considerable extent.

On Tuesday, SABMiller agreed to the deal which would see it brew one in every three beers worldwide. According to Euromonitor, the merger will control 46 percent of Australia’s beer market. SABMiller, with its 38 percent market share, is the biggest brewer in Australia. If the US$106 billion (AU$154 billion) deal manages to get through the ACCC, it will be the third biggest merger in history.

“This deal will not have an easy ride through the ACCC," the Sydney Morning Herald quoted Fels as saying. "The battle between second and third position often stimulates competition more generally in the market. In this case it's not clear there is a lot of surrounding competition, and therefore it could be that a cosy duopoly emerges."

A competition lawyer who refused to be named said that if the third biggest brewer in market poses a competitive constraint to the bigger two, it could be a cause of concern.

The merger is likely to have significant impact on the world beer industry, more so in the U.S. since 70 percent of the beer market would be under these two companies unless they share some of the assets. According to analysts, the beer giants might also have to get rid of Snow, which is the best-selling beer in the world.

"It's conceivable that the merger is blocked internationally," said Fels. "But if it's not, if it sails through overseas but is blocked here, they'd have to consider calling off this part of the transaction."

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