AB InBev improves offer for SABMiller, 'unacceptable' say shareholders

26th Jul 2016 08:13

(ShareCast News) - Brewer SABMiller has received a new, final takeover offer of 4,500p from Anheuser-Busch InBev after the collapse of the pound and pressure from a group of new activist shareholders, but major shareholder Aberdeen Asset Management said that it remained "unacceptable". AB InBev came back to the table on Tuesday morning with a £79bn ($103.81bn) all-cash offer and a partial share alternative, available for approximately 41% of the FTSE 100 company's shares, consisting of 0.483969 unlisted shares and 465.88 in cash for each SABMiller share, with the cash element hiked from 377.88p.The final offer is an improvement from November's original 4,400-a-share offer for a majority of SABMiller, which valued the company at £71bn.The UK company's board said it will continue to consult with shareholders and will meet in due course formally to review, having regard to all facts and circumstances, this revised offer and a further announcement will be made thereafter.In recent weeks SABMiller management have come under pressure to demand better terms, with existing investors jostling along with several activist newcomers including hedge fund Sandell Asset Management over the weekend, following US activist Elliott Management and Children's Investment Fund (TCI) earlier in the month.These investors have not only cited the significant weakening of the pound since the Brexit decision in June, but also highlighted concerns that the structure of the deal including a partial share alternative would favour SABMiller's two biggest shareholders, US tobacco company Altria and BevCo, which between them own 40.38% of the brewer.Following the sweetened offer on Tuesday, shareholder Aberdeen said SABMiller's two biggest shareholders, Altria and Bevco were still being favoured."In the absence of an improved offer we would be more than happy to remain committed long-term shareholders in SABMiller," the fund manager said in a statememt."We have engaged with SABMiller's board on the differential treatment of shareholders since the deal was first constructed. The way that the value of the partial share offer has diverged from the cash offer has compounded our discomfort."Altria and Bevco should not be able to vote on the cash offer as they are inherently conflicted by their future stakes in AB InBev if the deal completes. We believe the board's only choice is to treat Altria and Bevco as a separate class of shareholders and would urge them to make a public statement to this effect."