London - Anheuser-Busch InBev raised its bid for British brewer SABMiller to 79 billion pounds ($103 billion), responding to investor concerns about the deal’s structure after the UK’s vote to exit the European Union prompted a slump in sterling.
SABMiller shareholders will be entitled to receive 45 pounds ($59) a share, AB InBev said in a statement on Tuesday, from 44 pounds previously. ABI also increased the amount of cash for shareholders who choose a cash-and-stock alternative. They’ll now receive about 4.66 pounds in cash compared with 3.78 pounds previously. That offer, valued at about 39 pounds a share when the acquisition was announced last year, had surged to more than 50 pounds late on Monday. With the increased cash, it’s now worth about 51.14 pounds a share.
“The raised offer shows how much ABI wants to complete the deal,” Duncan Fox, an analyst at Bloomberg Intelligence, said by phone.
By raising the offer, the world’s biggest brewer addressed concerns from investors including Elliott Management and Davidson Kempner Capital Management that the deal was less attractive in the wake of the pound’s fall. SABMiller Chairman Jan du Plessis said last week that the board would wait until Chinese regulators approved the takeover before weighing the deal’s terms. SABMiller’s board had unanimously recommended the offer from the maker of Budweiser beer, in what would be the industry’s biggest-ever deal.
The shares closed Monday at 44.40 pounds. The new cash-and-shares alternative is 465.88 pence plus 0.483969 restricted shares for every SABMiller share. That value doesn’t include a discount for the fact that the stock issued in the deal can’t be traded for five years, AB InBev said. Its revised offer is final, the Belgian company said.
* With assistance from Sam Chambers
BLOOMBERG