LONDON • Anheuser-Busch InBev NV made a third offer for SABMiller, this time going public with a £65.2-billion (S$140.4 billion) proposal that promptly won support from its biggest shareholder - but not from the target.
SABMiller's board said it had "unanimously rejected" the takeover offer from the rival brewery, insisting it had "substantially" undervalued the group. "The board, excluding the directors nominated by (biggest shareholder) Altria Group, has unanimously rejected" the improved offer "as it still very substantially undervalues SABMiller, its unique and unmatched footprint, and its stand-alone prospects", said a statement.
Under British takeover law, AB InBev has until Oct 14 to make another formal offer or it must walk away. If it does not bid, it cannot renew its takeover effort for six months. A merger would create a beverage empire controlling the No. 1 or No. 2 positions in 24 of the world's 30 biggest beer markets, according to Exane BNP Paribas.
As with the previous offers from the maker of Budweiser, this one had two tiers: AB InBev would pay £42.15 a share in cash for a majority of the stock. The price is 44 per cent above London-based SABMiller's closing level on Sept 14, the day before renewed speculation about a deal, AB InBev said in a statement yesterday.
Altria Group, with a 27 per cent stake, said in a statement that it had supported the approach.
SABMiller has already rejected two proposals made privately of £38 pounds and £40 pounds a share. It can create more value by remaining independent and pursuing growth in emerging markets such as Africa and Latin America, the company had said earlier.
"AB InBev needs SABMiller, but it has made opportunistic and highly conditional proposals, elements of which have been deliberately designed to be unattractive to many of our shareholders," SABMiller chairman Jan du Plessis said in the statement.
After years of speculation, the approach was hastened by the impact of slowing economies in the emerging markets of China and Brazil, and after a decade of consolidation in the industry eliminated smaller targets. Brewers face their biggest challenge in half a century as consumers shift from mid-range mass-produced beers to premium, microbrew or discount products, McKinsey & Co analysts said in a report in June.