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Bud, Miller and Global Beer Giants Fight It Out for China's Rust Belt

Stocks in this article: BUDSBMRYASBRYTSGTYCABGY

BEIJING (TheStreet) -- Northeastern China is a land of shuttered factories and gritty cities that's often compared to America's Rust Belt.

It's also a land of enthusiastic beer drinkers in a country where beer consumption is growing fast -- jumping 4.6% last year from 2012 to a world-leading 49 billion liters, according to China's official industry data. China is become a competitive focal point for the globe's biggest breweries.

And the center of this focal point for Anheuser-Busch InBev (BUD), SABMiller (SBMRY), Japan's Asahi (ASBRY) and other beer giants is depressed, rusting northeastern China.

The competition intensified last month when InBev bought Ginsber, a brewery with a capacity of about 500 million liters a year that's based in the northeastern city of Jilin.

Ginsber's rival brands include an SABMiller-affiliated beer named Snow, Asahi-invested Tsingtao (TSGTY) and Chinese state-owned Yanjing. Upscale beers also available on area supermarket shelves include Denmark's Carlsberg (CABGY) and Holland's Heineken.

InBev did not disclose terms of the deal with Ginsber's seller Hongzui Group, a Communist Party-led enterprise based in the city of Siping that also makes chemicals, building materials and soybean oil.

But when China's Ministry of Commerce announced that the central government had approved Ginsber's sale to a foreign company, it said the deal was worth $622 million.

The takeover strengthened InBev's solid position in the northeast, where it already controls Harbin, a beer brewed in a factory city with the same name near the Russian border. Harbin was partly owned by SABMiller before InBev won control in 2004.

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