Brewing giant Anheuser-Busch InBev raised its bid Wednesday for SABMiller Plc, the world’s second-largest brewer.
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Earlier, AB InBev increased its cash offer to 42.15 pounds ($64.35) per share.
It said the cash part of the new offer values SABMiller around 44% more than the closing price of its stock on September 14.
The blockbuster deal, if accepted, would create a drinks giant worth more than £180 billion and be the biggest-ever takeover of a British company.
SABMiller’s chairman Jan du Plessis also said in the statement Wednesday: “AB InBev needs SABMiller”. Altria said it backed an offer of £42.15 or higher and urged SAB’s board “to engage promptly and constructively” with its suitor.
ABI clarified that the proposal, which it described as “highly attractive”, “does not constitute an offer or impose any obligation on AB InBev to make an offer, nor does it evidence a firm intention to make an offer within the meaning of the Code”.
One map featured on a website produced by AB InBev promoting the deal shows exactly why the world’s biggest beer company is so keen to buy the world’s second biggest brewer.
In its statement announcing the offer ABInBev says a combination would “build the first truly global beer company”, given both businesses complimentary markets.
“We believe this represents a good deal for SAB shareholders and ultimately we expect a deal to be agreed”, he said.
AB InBev is clearly pulling out all the stops – two other initial proposals at $61.07 and $58 per share were rejected by SABMiller, according to the filing. The regulator in turn forced AB InBev to issue a clarification statement making clear to investors that it did not have the backing of Santo Domingo’s investment vehicle, BevCo.
On Tuesday, SABMiller said strong demand for brands such as Aguila Light and Poker in Colombia and Castle Lite in South Africa drove up beverage and lager volumes by 5%.
SABMiller said in a news release that the revised bid “still very substantially undervalues SABMiller, its unique and unmatched footprint, and its standalone prospects”.
SABMiller added that AB InBev had timed the approach to take advantage of SABMiller’s recently depressed share price, that the structure of the proposals discriminates against a few SABMiller shareholders, and that AB InBev hasn’t offered it comfort on the significant regulatory hurdles in the US and China.
As well as bringing together the classic US favorites, the merger would also see AB InBev’s Stella Artois and SABMiller’s Grolsch in the same stable.
Together, AB InBev and SABMiller produce more than 70 percent of the beer in the USA market, with AB InBev alone responsible for roughly 45 percent.
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SABMiller employs around 69,000 people in more than 80 countries and has global annual sales of more than $26billion (£17billion).
