Dive Brief:
- SABMiller Plc has reportedly turned down a 66.4 billion pound ($100 billion) takeover offer from Anheuser-Busch InBev because the offer was too low, according to Bloomberg sources familiar with the matter. No final decision has been made regarding an official offer, but AB InBev could walk, the sources said.
- "The initial proposal to the brewer of Peroni and Foster’s beer, made last week, was worth slightly over 40 pounds a share, while its executives and some shareholders regard a deal at closer to 45 pounds as representing a fair value, the people said, asking not to be identified as details of the negotiations aren’t public," Bloomberg reported.
- If SABMiller were to receive 45 pounds (about $68) per share in an AB InBev takeover, the deal would be worth about 73 million pounds (about $110.8 million), the biggest merger in 2015.
Dive Insight:
According to people familiar with the matter, AB InBev is "lining up lenders including Bank of America Corp. and Banco Santander SA to arrange as much as $70 billion in financing for its takeover proposal," Bloomberg reported.
However, not all parties are convinced this merger would be beneficial for the companies. Daniel Matjila, CEO of The Public Investment Corp., SABMiller's fourth-largest shareholder, told Bloomberg that "he opposes a takeover because it could create a brewer that’s too dominant, hurting consumers, as well as potentially removing the company from the Johannesburg stock exchange."
If the deal goes through, the merger of the world's two largest brewing companies would comprise 30% of the global beer market, according to Euromonitor.
U.K. takeover laws say that AB InBev has until 5 p.m. on Oct. 14 to make an offer or announce it will not move forward with the deal, unless SABMiller asks regulators for a deadline extension.