Anheuser-Busch stock jumps as InBev raises its takeover offer
— -- Anheuser-Busch and InBev are meeting with legal and financial advisors in New York Friday about the sale, says a person familiar with the talks who declined to be identified because the talks could still fall through. Meetings to hammer out details such as top management, new company name and layoffs are expected to last through the weekend with plans to announce a deal on Sunday, says this person.
"It is our policy to not confirm, deny or speculate on rumors of potential investments, acquisitions, mergers, new business partnerships or other transactions," says W. Randolph Baker, Anheuser-Busch chief financial officer.
InBev had made a proposal to Anheuser-Busch CEO August Busch IV on June 11 for an all-cash buyout valued at $46 billion, a 30% premium over what A-B's stock had been trading at for the 30 day average leading up to the offer.
A-B snubbed the offer two weeks later saying it did not provide enough value to shareholders based on its leading position in the U.S. and the company's iconic brands. A-B has about 48% of the $90 billion U.S. market, the world's biggest, with its Bud Light, Budweiser, Michelob and Rolling Rock brands.
Wall Street applauded the likelihood of a A-B deal with InBev. A-B's stock jumped more than 8% Friday to close at $66.50, amid reports that a deal was close to being final despite a courtship that included lawsuits and move by InBev to replace A-B's board.
"It really all about the money despite the flag waving and posturing," says Juli Niemann, an analyst with Smith Moore & Co. in St. Louis. "Getting a little more on the table is getting everyone to be friendlier."
A merger between the two would create the world's largest brewery with worldwide volume of 357 million barrels and $36 billion in sales surpassing the now number one, SABMiller with more than 200 million barrels and $21.4 billion in revenue. A month ago SABMiller received regulatory clearance to combine its U.S. operations with MolsonCoors.
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