Belgium-based Anheuser-Busch InBev raised its offer for London-based SABMiller in a proposed $100 billion-plus beer megamerger, but a major investor rejected the proposal Tuesday.
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SABMiller said it would consult with shareholders before formally considering the revised offer.
Investors who opt for the cash-and-stock alternative now will receive about 4.66 pounds in cash compared with 3.78 pounds previously, with the balance in shares.
However, a SABMiller shareholder, Aberdeen Asset Management, released a statement on Tuesday, claiming the revised deal was unacceptable because it undervalued the company, favoring Altria and Santo Domingo family of Colombia.
However the fall in value of the pound (combined with a rise in the FTSE consumer goods index) is making AB InBev’s cash offer to shareholders far less attractive than it was. But in an effort to increase its presence in Africa and other emerging markets, will the combination negatively impact AB InBev’s USA business?
That would value SABMiller, which is based in London, at 79 billion pounds.
The pound has collapsed in value versus the dollar since the June 23rd vote, falling more than 10 per cent to $1.31.
“The board needs to consider the revised offer, taking into account all facts and circumstances”, Clark wrote.
Anheuser-Busch InBev (NYSE:BUD) has got approval from the U.S. Justice Department to go ahead with the acquisition of its chief competitor SABMiller, for a massive ~$107 billion.
The merger would create a brewing giant that supplies almost a third of the world’s beer and would be the biggest foreign takeover of a British company.
Anheuser-Busch InBev increased its bid for SABMiller to £45 ($59) per share from £44, which AB InBev said is its final offer.
AB InBev’s decision to revise its offer follows complaints from investors on the original terms of the agreement.
The deal is expected to boost world-leader AB InBev’s prospects in developing markets in Africa and China.
Failing a new offer, Aberdeen would “happily” remain a long-term shareholder in SABMiller, it added.
SABMiller owns beer brands including Fosters, Miller Genuine Draft, Castle Lager and Pilsner Urquell; while AB InBev also makes Stella Artois, Corona, Beck’s and Hoegaarden. AB InBev shares increased 0.6% to €115.50 ($126.83) in Brussels.
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The £50bn takeover of one of the world biggest brewers is expected to receive a vital green light from China this week – but remains under threat from the double threat of the Brexit vote and a United Kingdom court ruling.
