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 After two weeks of speculation, U.S. beer maker Anheuser-Busch Cos. announced late Wednesday, June 11 that it has received an unsolicited $46.3 billion cash offer from European rival InBev SA.
InBev has confirmed that it has offered to pay $65 per share for Anheuser-Busch, the St. Louis brewer of Budweiser, Bud Light and numerous other beer brands. In a press statement, Anheuser-Busch said its board of directors plans to evaluate the offer "carefully," and in the context of the company's long-term strategic plan. The company said it will take the action that is in the best interests of its shareholders, but gave no timetable as to when it would respond to the offer. Anheuser-Busch could not be reached for comment. Shares of the company were up more than 7% in after-hours trading Wednesday. Earlier, the stock closed at $58.35 per share. InBev's legal adviser was Sullivan & Cromwell LLP's Frank Aquila; it took financial advice from Antonio Weiss, Steve Golub and Mike Wilkerson of Lazard and Doug Braunstein of J.P. Morgan. While this deal has been rumored for years, speculation has run high the past two weeks after Belgian daily De Tijd reported May 27 that InBev's board of directors was about to decide whether to give advisers the nod to start negotiating with Anheuser-Busch. The Financial Times then reported that financing for a deal, which may reach $50 billion, had been provisionally arranged with J.P. Morgan Chase & Co. and Banco Santander SA. InBev, of Leuven, Belgium, is under pressure to make a sizable acquisition to cut costs, and Anheuser-Busch represents its greatest chance to cut these expenses, analysts say. Sources say overwhelmingly that Anheuser-Busch's only option to avoid a takeover offer would be to acquire the remaining 50% it does not own in Mexico's Grupo Modelo SAB de CV, the maker of Corona and other beer brands. Analysts estimate the deal would reach about $10 billion for Modelo, making Anheuser-Busch that much more unaffordable to InBev. The deal would reflect about a 25% premium to Modelo's share price. On paper, the two companies would fit well, as InBev, the world's largest beer maker, tries to gain a strong foothold in the U.S., where Anheuser-Busch holds 48.5% of U.S. beer sales. InBev, however, eclipsed Anheuser-Busch in 2006 as the world's largest brewer by sales, two years after the brewer, then known as Interbrew NV/SA, merged with Brazil's Cia. de Bebidas das Américas, or AmBev, in a complex $11 billion deal. Here's a summary of the earlier rumors about the deal, in no particular order:
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