12th Oct 2015 14:23
LONDON (Alliance News) - Anheuser-Busch InBev NV Monday confirmed that it has made an improved proposal in its effort to buy rival drinks giant SABMiller PLC, which values its target at about GBP70.43 billion, after its offer last week was rejected for "substantially undervaluing" SABMiller.
Should a deal be reached, AB InBev said its combination with SABMiller would "build the first truly global beer company", the largest in the world.
The new proposal values SABMiller at GBP43.50 per share, and there is a partial share alternative available for about 41% of shares. Based on 1.62 billion shares, the cash offer values SABMiller at GBP70.43 billion.
AB InBev said the cash proposal represents a premium of over 48% to SABMiller's closing share price of GBP29.34 on September 14.
Under the proposal, SABMiller shareholders who elect for the partial share alternative will receive 0.483969 restricted shares and GBP3.56 in cash for each SABMiller share, a valuation of GBP38.88 per share. That equates to a 33% premium to the closing SABMiller share price on September 14, and taking into account AB InBev's closing share price on October 9 of EUR98.30.
AB InBev said the improved proposal is pre-conditional on both Altria Group Inc and BevCo Ltd undertaking to elect for the partial share alternative in respect of their combined 41% stake as SABMiller's two largest shareholders. It is thought that the partial share alternative would be attractive to Altria and BevCo for tax reasons.
AB InBev said it anticipates that most of SABMiller's remaining shareholders will elect for the cash offer.
"AB InBev will not be seeking the SABMiller board's recommendation with respect to the partial share alternative," it said in a statement.
Last Wednesday, SABMiller rejected an offer of GBP42.15 per share in cash plus a partial share alternative for up to 41% of SABMiller's shares, valuing the company at around GBP68.2 billion.
It said the offer "substantially undervalued" the business.
Shares in SABMiller were trading down 0.5% at 3,653.00 pence Monday afternoon.
By Karolina Kaminska; [email protected] @KarolinaAllNews
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