Business Daily
Date: 14.10.2015
Page 21
Article size: 214 cm2
ColumnCM: 47.55
AVE: 90355.55
SABMiller accepts new $106 billion AB InBev takeover offer
SABMiller, which own's Kenya's Ker­
inget mineral water maker Crown Bev­
erages, accepted a takeover proposal at
the fifth time of asking after Anheuser­
Busch InBev, the world's largest brewer,
set out a cash­and­share package cur­
rently worth 69 billion pounds ($106
billion).
The deal to create a brewer making
almost a third of the world's beer would
rank in the top five mergers in corporate
history and be the largest takeover of
a UK company. After repeated rebut­
tals from its next largest rival, AB In­
Bev said today it was willing to pay 44
pounds in cash per SABMiller share,
with a partial share alternative set at a
discount and limited to 41 per cent of
SABMiller shares.
The parties have agreed that AB
InBev would pay a break fee of $3
40.5 per cent of the UK­based brewer.
Were they to accept the discounted al­
SABMiller said it had indicated to
billion to SABMiller in the event the
ternative and all other shareholders
AB InBev that its board would be pre­
pared to accept the offer and said it had
transaction fails due to the significant
regulatory issues or because AB InBev
asked for a two­week extension to the
shareholders do not back it.
deadline set for its rival to announce a
The new offer unveiled yesterday
surpasses a Monday proposal set at
43.50 pounds in cash and is 50 per
cent above SABMiller's shares on Sep­
tember 14, the day before speculation
surfaced about an impending AB InBev
approach. The partial share alternative
remains, designed for SABMiller's two
main shareholders, cigarette­maker Al­
tria and the BevCo company of Colom­
bia's Santo Domingo family, who own
took cash, the offer would be worth 69
billion pounds at current prices.
SABMiller shares were up 8.9 per
cent at 0720 GMT, while AB InBev's
were 3.8 per cent higher.
firm intention to bid. The new deadline
is October 28.
The new group would combine AB
InBev's Budweiser, Stella Artois and
Corona lagers with SABMiller's Pero­
ni, Grolsch and Pilsner Urquell.
AB InBev would add certain Latin
American and Asian breweries to its al­
ready large presence and, crucially, see
it enter Africa for the first time.
"There's so much we don't know ­ we
don't know what costs they'll take out,
we don't know what they'll get for the
asset sales that they'll have to make.
But if you make reasonable assump­
tions about those, I think it's a pretty
good price all around," said Morningstar
analyst Phil Gorham.
Africa is expected to see a sharp
Ipsos Kenya ­ Acorn House,97 James Gichuru Road ­ Lavington ­ Nairobi ­ Kenya
jump in the legal drinking age popula­
tion in coming years and a fast­growing
middle class more willing to switch to
lagers and ales from illegal brews.
In western Europe and North Amer­
ica beer volumes have steadily declined
in the past two decades and U.S. con­
sumers in particular have shifted to
craft brews made by small players.
For many observers this would
be the final chapter of consolidation
in brewing. The big four, AB InBev,
SABMiller, Heineken and Carlsberg,
are already present across the globe
and brewing more than half of the
world's beer.
­REUTERS