TAPA Molson Coors Brewing Company

BRUSSELS—The European Union on Tuesday approved Anheuser Busch InBev NV's roughly $108 billion takeover of rival SABMiller PLC on condition that the brewer sheds almost all of SABMiller's European assets.

The European Commission, the bloc's antitrust agency, said it initially had concerns the deal would have led to higher prices and would have made tacit coordination among rival brewers more likely, but added that AB InBev's concessions assuaged those worries.

Belgium-based AB InBev has pledged to sell its European premium brands Peroni and Grolsch, as well as British craft-beer brand Meantime, to Asahi Group Holdings Ltd. in an offer valued at around $2.9 billion. It also said it would shed SABMiller's Central and Eastern European assets, but hasn't yet found a buyer for those.

The commission's decision to clear the deal is conditional upon AB InBev disposing of the assets, the EU said.

"Today's decision will ensure that competition isn't weakened in these markets and that EU consumers are not worse off," said EU antitrust chief Margrethe Vestager.

The AB InBev-SABMiller merger, which executives hope to close by the second half of this year, would create the world's biggest beer group with about 30% of the global market.

The deal, announced in November, has also drawn scrutiny from antitrust regulators in the U.S., China and South Africa, as well as other markets.

In central and Eastern Europe, AB InBev has offered up all of SABMiller's assets in Hungary, Romania, Czech Republic, Slovakia and Poland, which includes the rights to Pilsener Urquell outside the U.S.

Within the U.S., AB InBev has already agreed to sell Pilsener Urquell to Molson Coors Brewing Co. as part of a larger deal divesting SABMiller's stake in its joint venture in MillerCoors with Molson.

Write to Natalia Drozdiak at natalia.drozdiak@wsj.com

(END) Dow Jones Newswires

May 24, 2016 12:55 ET (16:55 GMT)

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