SABMiller Agrees To Sweetened Offer By AB InBev

(RTTNews) - British brewer SABMiller Plc (SAB.L, SABMRY.PK) Tuesday said it agreed in principle to the possible recommended offer to be made by Belgian brewer Anheuser-Busch InBev NV, or AB InBev (BUD, AHBIF.PK). According to the terms, AB InBev would buy SABMiller for 44 pounds per share in cash, with a partial share alternative or PSA available for approximately 41 percent of the SABMiller shares.

On Monday, AB InBev had raised its takeover bid for SABMiller to 43.50 pounds per share in cash, or $66.8 per share. AB InBev would also agree to a reverse break fee of $3 billion payable to SABMiller.

The cash consideration under the transaction would be financed through a combination of AB InBev's internal financial resources and new third party debt.

The all-cash offer is a premium of approximately 50 percent to SABMiller's closing share price on September 14, being the last business day prior to renewed speculation of an approach from AB InBev. SABMiller shareholders would also be entitled to any dividends declared or paid by SABMiller.

The PSA consists of 0.483969 unlisted shares and 3.7788 pounds in cash for each SABMiller share, equivalent to a value of 39.03 pounds per SABMiller share on October 12. This represents a premium of approximately 33 percent to the SABMiller share price on September 14.

Besides a unanimous recommendation by the boards of both companies, the deal also requires the execution of irrevocable undertakings to vote in favor of the offer from Altria Group, Inc. (MO), SABMiller's largest shareholder, and BevCo Ltd., and from AB InBev's largest shareholders, the Stichting Anheuser-Busch InBev, EPS Participations SaRL and BRC SaRL.

AS per the deadline extension by the Panel on Takeovers and Mergers, AB InBev must, by not later than October 28, either announce a firm intention to make an offer for SABMiller or announce that it does not intend to make an offer.

The latest proposal by AB InBev, its fifth for SABMiller, comes just one day before the expiry of the deadline for a formal offer. SABMiller, the brewer of Peroni and Foster's beer, reportedly wants AB InBev to pay a price closer to 45 pounds per share.

In London, SABMiller shares are gaining 9.13 percent to trade at 3,952 pence.

In Belgium, AB InBev shares are up 3.7 percent to trade at 101.95 euros.