This article deals with these two major beer companies and how Anheuser- Busch InBev paid 104.2 billion dollars to takeover SABMiller. This takeover will make AB InBev a powerhouse in the world beer market. There was a lot of behind the scenes talks and deals made in order for this deal to be approved by both sides. It began with AB InBev’s offer of 44 euros a share and a 3 billion dollar breakup fee if any problems happened with the deal. After this, there was a tiny mishap that happened with public shares by AB InBev. They made a public share proposal of 42.15 euros per share, which they thought they were backed up by investors, but they were not. This resulted in heated talks and a quick rejection of the share proposal. The chairman of SABMiller, Jan du Plessis, was an important piece that kept the deal intact and he helped achieve a better price for the company. The board of directors for SABMiller had many arguments and talks questioning whether to keep the 42.15 a share, because some of the big investors wanted to keep that price. But, Jan kept the board together and convinced them that he could get a better deal for everyone. Then, both sides decided it would be best if the meetings were more private, and this is where SABMiller negotiated the deal up to 43.50 euros a share. This increase in the share proposal made negotiations more serious and the big investors were backing up the deal. An example of this is how the Santo Domingo family, a major share holder of SABMiller, agreed to terms because of the increase in the cash component of the partial share plan. The terms were agreed upon, and the next step was facing antitrust scrutiny and officially closing the deal. It was estimated that the deal could take as long as a year to close. AB InBev will have to work with China and the U.S to get regulatory approval but once that is done, they will be a dominant power in the beer market.
Saturday, October 24, 2015
How AB InBev Won over SABMiller
http://www.wsj.com/articles/
This article deals with these two major beer companies and how Anheuser- Busch InBev paid 104.2 billion dollars to takeover SABMiller. This takeover will make AB InBev a powerhouse in the world beer market. There was a lot of behind the scenes talks and deals made in order for this deal to be approved by both sides. It began with AB InBev’s offer of 44 euros a share and a 3 billion dollar breakup fee if any problems happened with the deal. After this, there was a tiny mishap that happened with public shares by AB InBev. They made a public share proposal of 42.15 euros per share, which they thought they were backed up by investors, but they were not. This resulted in heated talks and a quick rejection of the share proposal. The chairman of SABMiller, Jan du Plessis, was an important piece that kept the deal intact and he helped achieve a better price for the company. The board of directors for SABMiller had many arguments and talks questioning whether to keep the 42.15 a share, because some of the big investors wanted to keep that price. But, Jan kept the board together and convinced them that he could get a better deal for everyone. Then, both sides decided it would be best if the meetings were more private, and this is where SABMiller negotiated the deal up to 43.50 euros a share. This increase in the share proposal made negotiations more serious and the big investors were backing up the deal. An example of this is how the Santo Domingo family, a major share holder of SABMiller, agreed to terms because of the increase in the cash component of the partial share plan. The terms were agreed upon, and the next step was facing antitrust scrutiny and officially closing the deal. It was estimated that the deal could take as long as a year to close. AB InBev will have to work with China and the U.S to get regulatory approval but once that is done, they will be a dominant power in the beer market.
This article deals with these two major beer companies and how Anheuser- Busch InBev paid 104.2 billion dollars to takeover SABMiller. This takeover will make AB InBev a powerhouse in the world beer market. There was a lot of behind the scenes talks and deals made in order for this deal to be approved by both sides. It began with AB InBev’s offer of 44 euros a share and a 3 billion dollar breakup fee if any problems happened with the deal. After this, there was a tiny mishap that happened with public shares by AB InBev. They made a public share proposal of 42.15 euros per share, which they thought they were backed up by investors, but they were not. This resulted in heated talks and a quick rejection of the share proposal. The chairman of SABMiller, Jan du Plessis, was an important piece that kept the deal intact and he helped achieve a better price for the company. The board of directors for SABMiller had many arguments and talks questioning whether to keep the 42.15 a share, because some of the big investors wanted to keep that price. But, Jan kept the board together and convinced them that he could get a better deal for everyone. Then, both sides decided it would be best if the meetings were more private, and this is where SABMiller negotiated the deal up to 43.50 euros a share. This increase in the share proposal made negotiations more serious and the big investors were backing up the deal. An example of this is how the Santo Domingo family, a major share holder of SABMiller, agreed to terms because of the increase in the cash component of the partial share plan. The terms were agreed upon, and the next step was facing antitrust scrutiny and officially closing the deal. It was estimated that the deal could take as long as a year to close. AB InBev will have to work with China and the U.S to get regulatory approval but once that is done, they will be a dominant power in the beer market.
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