Reports in both the Financial Times and The Guardian, say that Nomura has run the rule over such a merger to overcome slowing growth and create value for shareholders.
The analysts see the creation of ‘SABGEO’ as similar to the merger of Guinness and Grand Metropolitan to form Diageo, 17 years ago.
Nomura said: “With Diageo's growth stalled and SAB reported to be looking at strategies to fend off AB InBev, a deal might make sense to both management teams.
"We estimate that with circa 50:50 emerging and mature market split of profits, a merged group could offer a firmer profit base in uncertain times (for SABMiller holders) and potentially increase its growth profile in the longer term (for Diageo holders)," Nomura has told clients.
It is believed that the biggest SAB shareholders, the Altria and Santo Domingo families, might also prefer a merger to an AB InBev takeover for tax reasons.