Anheuser-Busch InBev raised its proposed takeover offer for SABMiller to £43.50 a share on Monday, upping the stakes in a takeover battle to create the world's dominant brewing company, according to people familiar with the latest bid.
News of the fourth proposal by AB InBev for its London-listed rival, which values SABMiller's equity at $70bn, came with less than 52 hours before a UK bid deadline.
Last week, the majority of the board of the London-listed company dismissed AB InBev's cash offer of £42.15 per share in cash and a partial share alternative, as "very substantially undervaluing" the brewer.
From Anheuser-Busch:
BRUSSELS, Oct. 12, 2015 The enclosed information constitutes regulated information as defined in the Belgian Royal Decree of 14 November 2007 regarding the duties of issuers of financial instruments which have been admitted for trading on a regulated market.
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF THAT JURISDICTION.
THIS ANNOUNCEMENT IS NOT AN ANNOUNCEMENT OF A FIRM INTENTION TO MAKE AN OFFER UNDER RULE 2.7 OF THE CITY CODE ON TAKEOVERS AND MERGERS AND THERE CAN BE NO CERTAINTY THAT AN OFFER WILL BE MADE.
Anheuser-Busch InBev ("AB InBev") (Euronext: ABI) (NYSE: BUD) notes recent speculation and confirms that it has today made an improved proposal to the Board of SABMiller plc ("SABMiller") (LSE: SAB) (JSE: SAB) to combine the two companies and build the first truly global beer company.
Improved Proposal
AB InBev's improved proposal comprises a cash offer of GBP 43.50 per share, with a partial share alternative available for approximately 41% of the SABMiller shares.
The cash proposal represents a premium of over 48% to SABMiller's closing share price of GBP 29.34 on 14th September 2015(being the last business day prior to renewed speculation of an approach from AB InBev).
The Partial Share Alternative
Under the improved proposal, SABMiller shareholders who elect for the partial share alternative will receive 0.483969 Restricted Shares and GBP 3.56 in cash for each SABMiller share[1]. Based on the closing price of AB InBev's ordinary shares on 9th October 2015 of EUR 98.30, the partial share alternative, including the GBP 3.56 in cash, would value each SABMiller share at GBP 38.88 per share, representing a premium of approximately 33% to the closing SABMiller share price of GBP 29.34 as of 14th September 2015[2].
This improved proposal is pre-conditional on both Altria Group, Inc. and BevCo Ltd. undertaking to elect for the partial share alternative in respect of all of their SABMiller shares.
AB InBev anticipates that most SABMiller shareholders, other than Altria Group, Inc. and BevCo Ltd., would wish to elect for the cash offer.
AB InBev will not be seeking the SABMiller Board's recommendation with respect to the partial share alternative.
Other Matters
The announcement of a formal transaction would be subject to the pre-conditions noted above and the other pre-conditions and conditions disclosed in AB InBev's announcement on 7th October 2015. AB InBev reserves the right to waive in whole or in part any of the pre-conditions to the making of an offer as set out in that announcement or referred to above.
The improved proposal does not constitute an offer or impose any obligation on AB InBev to make an offer, nor does it evidence a firm intention to make an offer within the meaning of the Code. AB InBev does not, therefore, regard it as forming the basis for an announcement pursuant to Rule 2.2(a) of the Code.
There can be no certainty that a formal offer will be made. A further statement will be made as appropriate.
AB InBev reserves the following rights:
a) to introduce other forms of consideration and/or to vary the composition of consideration;
b) to implement the transaction through or together with a subsidiary of AB InBev or a company which will become a subsidiary of AB InBev;
c) to make an offer (including the cash offer and partial share alternative) for SABMiller at any time on less favorable terms:
(i) with the agreement or recommendation of the Board of SABMiller;
(ii) if a third party announces a firm intention to make an offer for SABMiller on less favorable terms; or
(iii) following the announcement by SABMiller of a whitewash transaction pursuant to the Code; and
d) in the event that any dividend is announced, declared, made or paid by SABMiller, to reduce its offer (including the cash offer and partial share alternative) by the amount of such dividend.
Lazard is acting exclusively as financial adviser to AB InBev and for no one else in connection with the matters described in this announcement and is not, and will not be, responsible to anyone other than AB InBev for providing the protections afforded to clients of Lazard, or for providing advice in connection with the matters described in this announcement. For these purposes "Lazard" means Lazard Freres & Co. LLC and Lazard & Co., Limited. Lazard & Co., Limited is authorised and regulated in the United Kingdom by the Financial Conduct Authority. Neither Lazard nor any of its affiliates owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Lazard in connection with this announcement or the matters described in this announcement.
Deutsche Bank AG is authorised under German Banking Law (competent authority: European Central Bank) and, in the United Kingdom, by the Prudential Regulation Authority. It is subject to supervision by the European Central Bank and by BaFin, Germany'sFederal Financial Supervisory Authority, and is subject to limited regulation in the United Kingdom by the Prudential Regulation Authority and Financial Conduct Authority. Details about the extent of its authorisation and regulation by the Prudential Regulation Authority, and regulation by the Financial Conduct Authority, are available on request or fromwww.db.com/en/content/eu_disclosures.htm
Deutsche Bank AG, acting through its London branch ("DB"), is acting as corporate broker to AB InBev and no other person in connection with this announcement or its contents. DB will not be responsible to any person other than AB InBev for providing any of the protections afforded to clients of DB, nor for providing any advice in relation to any matter referred to herein. Without limiting a person's liability for fraud, neither DB nor any of its subsidiary undertakings, branches or affiliates nor any of its or their respective directors, officers, representatives, employees, advisers or agents owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of DB in connection with this announcement, any statement contained herein or otherwise.
In accordance with Rule 2.6(a) of the Code, AB InBev must, by not later than 5.00 p.m. on Wednesday 14th October 2015, either announce a firm intention to make an offer for SABMiller in accordance with Rule 2.7 of the Code or announce that it does not intend to make an offer for SABMiller, in which case the announcement will be treated as a statement to which Rule 2.8 of the Code applies. This deadline will only be extended with the consent of SABMiller and the Takeover Panel in accordance with Rule 2.6(c) of the Code.
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