A paper marriage between Belgium's Interbrew and South African Breweries (SAB) is rumoured to be on the cards after abrupt share movements in SAB's stock yesterday.

According to reports in the South African press, Interbrew is negotiating an alliance which would see the world's third largest brewer acquire a large stake in SAB, the world's fourth-largest brewer.

Speculation yesterday suggested that a "paper marriage" between the two companies was possible, which would result in SAB taking control of the UK brewer Bass.

Such a result would make SAB the second-largest brewer in the UK, and resolve Interbrew's forced disposal of Bass, ordered by UK's competition authorities.

SAB's share price ended 2.76% lower yesterday at SAR59,90, although it was still 8% higher than a month ago.

Analysts said the drop in SAB's share price was explained by the fact that the market was hoping for an outright bid by SAB. A deal with Interbrew would probably rule out such an event.

Analysts believe a paper marriage between SAB and Interbrew would make sense. Interbrew would offer UK brewing assets which would give SAB much-needed exposure to a mature market and a stable currency. SAB would give Interbrew access to a number of emerging markets, including China and the increasingly important eastern and central European markets.