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SABMiller Agrees to £68 Billion Takeover by AB InBev

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SABMiller Agrees to £68 Billion Takeover by AB InBev

SABMiller Agrees to £68 Billion Takeover by AB InBev
October 13
09:58 2015

The board of SABMiller has accepted the key terms of a possible recommended offer to be made by AB InBev of £44.00 per share in cash, with a partial share alternative available for approximately 41% of the SABMiller shares. The cash and share offer is worth £68 billion ($104.4 billion), which would make the deal one of the top five mergers in corporate history and the largest takeover of a UK company.

The latest cash proposal represents a premium of over 50% to SABMiller’s closing share price of £29.34 on 14th September 2015 – the last business day prior to renewed speculation of an approach from AB InBev.

A successful acquisition by AB InBev would combine the world’s two largest brewers to create a group that would generate revenues of $64 billion and EBITDA of $24 billion. The combination of AB InBev and SABMiller would result in a truly global brewer that would take its place as one of the world’s leading consumer products companies. Given the largely complementary geographical footprints and brand portfolios of AB InBev and SABMiller, the combined group would have operations in virtually every major beer market, including key emerging regions with strong growth prospects such as Africa, Asia, and Central and South America.

ABInBevLogoAB InBev had four earlier proposals rejected by the SABMiller board – the first at £38.00 per share in cash, the second at £40.00 per share in cash, the third at £42.15 per share in cash and the fourth at £43.50 per share in cash.

AB InBev has agreed to pay SABMiller a $3 billion break fee in the event that the transaction fails to close as a result of the failure to obtain regulatory clearances or the approval of AB InBev shareholders.

At the request of the SABMiller board, the Panel on Takeovers and Mergers has agreed to extend the deadline for AB InBev to lodge a formal bid from 14 October to 5.00 pm on 28 October 2015, to enable the parties to continue their talks regarding the possible offer.

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