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 There are reports that Anheuser-Busch Cos. may reject InBev SA's offer this week, claiming that it undervalues the companny. The Wall Street Journal reported that Anheuser-Busch will reject the offer and unveil a $1 billion cost-cutting plan to appease its own investors, setting the stage for a hostile takeover by InBev.
Anheuser apparently approached its Mexican partner, Grupo Modelo SA de CV, about cutting
a deal to keep InBev at bay. But those talks appear not to have made
any progress. Such a transaction would likely entail Anheuser acquiring
all of Modelo, of which it already owns 50%. That move would likely
make Anheuser too expensive for InBev to acquire.
Advised by Lazard along with J.P. Morgan Chase & Co. and law firm Sullivan & Cromwell LLP, InBev unveiled an unsolicited $46.3 billion takeover bid June 11. The Leuven, Belgian-based brewer is already the global market leader, and the addition of Anheuser-Busch would give it a company that commands almost 49% of the U.S. beer market. Impatient to get an answer from Anheuser-Busch, InBev CEO Carlos Brito on Wednesday wrote to August Busch IV, his counterpart in St. Louis, for a third time. In the latest missive, Brito said that InBev had the necessary financing in place and had paid about $50 million in commitment fees to leading financial institutions. They are Spain's Banco Santander SA, Bank of Tokyo-Mitsubishi UFJ Ltd., Barclays Capital, BNP Paribas SA, Deutsche Bank AG, Fortis Bank NV/SA, ING Bank Groep NV, J.P. Morgan Chase & Co., Mizuho Corporate Bank Ltd. and Royal Bank of Scotland Group plc. "It seems as if InBev is losing its patience and Anheuser-Busch's board is taking its time," analyst Marc Leemans of Bank Degroof wrote Thursday. He also predicted that Brito's latest letter looks like the final stage before InBev goes directly to shareholders. "If Anheuser-Busch's board rejects the offer and tries to sell its own strategic plan to shareholders, it is likely that the deal will become more expensive for InBev," he noted. -- Maria Woehr and Renee Cordes See The Deal's Anheuser 'to reject InBev offer'
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