Budweiser Raises Bid For SABMiller Again

SABMiller (Xetra: BRW1.DE - news) has described the latest bid for the company by the world's largest brewer as "opportunistic, highly conditional" and "substantially undervaluing" its business.

The FTSE 100 firm spoke out hours after Anheuser-Busch InBev, which makes Budweiser, Stella Artois and Corona, confirmed it had made a third bid, representing an all-cash offer of 42.15p-per-share.

The US-based firm said it was disappointed its two prior offers were turned down.

The latest bid valued SAB at £68.1bn on the face of the all-cash element but SAB argued that a stock dilution contained in the terms of the "blended" offer took £2 off the value of each share for some shareholders.

AB InBev said it believed the offer would be attractive to SAB investors as it wanted to "build the first truly global beer company."

A merged group would give AB InBev access to markets in Africa, Latin America and Asia.

As SAB signalled it was likely to reject the latest offer its largest shareholder, Altria Group (NYSE: MO - news) , said it supported a deal - piling pressure on the company's board.

It (Other OTC: ITGL - news) said: "Altria urges SABMiller's board to engage promptly and constructively with AB InBev to agree on the terms of a recommended offer.

In its statement SAB said: "It should be noted that the all-cash offer within the new proposal announced today is only 15p (per share) higher than the £42 (per share) proposal considered and rejected on 5 October 2015.

"The board will, of course, meet formally to consider the £42.15 proposal as soon as practicable and a further announcement will be made thereafter."

SAB's chairman, Jan du Plessis, added: "SABMiller is the crown jewel of the global brewing industry, uniquely positioned to continue to generate decades of standalone future volume and value growth for all SABMiller shareholders from highly attractive markets.

"AB InBev needs SABMiller but has made opportunistic and highly conditional proposals, elements of which have been deliberately designed to be unattractive to many of our shareholders.

"AB InBev is very substantially undervaluing SABMiller."

SAB's shares were 3% higher in the first hour of trading on Wednesday.