AB InBev sweetens its offer for SABMiller to £79b

[GENEVA] Anheuser-Busch InBev NV raised its bid for British brewer SABMiller Plcto £79 billion (S$140.4 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 a share, AB InBev said in a statement Tuesday, from £44 previously. ABI also increased the amount of cash for shareholders who choose a cash-and-stock alternative.

They'll now receive about £4.66 in cash compared with £3.78 previously. That offer, valued at about £39 a share when the acquisition was announced last year, had surged to more than £50 late Monday. With the increased cash, it's now worth about £51.14 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. 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.

BLOOMBERG