LONDON (BLOOMBERG) - Budweiser brewer Anheuser-Busch InBev agreed to buy its British rival SABMiller for £68 billion (S$146.45 billion), raising its bid to clinch a record industry deal that brings one out of every three beers sold worldwide under a single company.
AB InBev offered 4,400 pence a share in cash for a majority of the shares in its nearest competitor, gaining brands such as Fosters, Peroni and Grolsch, and giving it control of about half the industry's profit. The price is 46 per cent above SABMiller's closing value on Sept 15, the day before the companies disclosed they were in contact about a potential bid.
After years of speculation, the deal has been hastened by the impact of slowing economies in the emerging markets of China and Brazil. A 20 per cent drop in SABMiller shares in the months preceding AB InBev's approach and the prospect of an end to cheap credit also served as a catalyst to a takeover.
The agreement, which is tentative, caps more than two weeks of back-and-forth negotiations over the price. SABMiller said it's board is prepared to recommend it.
SABMiller shares fell 1.3 per cent to 3,621.50 pence in London on Monday. AB InBev was little changed at 98.35 euros in Brussels.
SABMiller spurned previous proposals, including one AB InBev made public on Oct 7 that valued the company at about £65.2 billion.
SABMiller's two largest shareholders, Altria Group Inc. and Bevco Ltd., can receive cash and stock valued at £39.03 a share for their stakes, which account for 41 per cent of the company.