Any AB InBev Acquisition of Heineken Is Workable, RBC Says
2014-08-11 07:56:38.86 GMT
By Gaurav Panchal
Aug. 11 (Bloomberg) -- If the Heineken family could be
convinced to sell, acquisition of Heineken by AB InBev would
work at several levels, RBC analyst James Edwardes Jones says in
a note today.
* Market’s conventional wisdom is that Heineken’s independence
is underwritten by Heineken family and non-negotiable;
thesis not supported by numbers: RBC
* Over last 10 yrs Heineken delivered total shareholder
return (in euros) of 240%, vs 630% for ABI, 490% for
SABMiller: RBC
* If the “independence” obstacle disappeared, acquisition of
Heineken by ABI would make sense: RBC
* Assuming takeover at EU68, 30% premium to Heineken’s shares,
50/50 debt/equity financing ratio, deal would earn ROIC of
8.5%, EPS enhancement of 17%: RBC
* Raises Heineken to outperform vs sector perform, PT raised
to EU62 vs EU59
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--With assistance from Francesca Cinelli in Milan.
To contact the reporter on this story:
Gaurav Panchal in London at +44-20-7392-0511 or
gpanchal2@bloomberg.net
To contact the editors responsible for this story:
Andrew Rummer at +44-20-7073-3722 or
arummer@bloomberg.net
James Ludden
2014-08-11 07:56:38.86 GMT
By Gaurav Panchal
Aug. 11 (Bloomberg) -- If the Heineken family could be
convinced to sell, acquisition of Heineken by AB InBev would
work at several levels, RBC analyst James Edwardes Jones says in
a note today.
* Market’s conventional wisdom is that Heineken’s independence
is underwritten by Heineken family and non-negotiable;
thesis not supported by numbers: RBC
* Over last 10 yrs Heineken delivered total shareholder
return (in euros) of 240%, vs 630% for ABI, 490% for
SABMiller: RBC
* If the “independence” obstacle disappeared, acquisition of
Heineken by ABI would make sense: RBC
* Assuming takeover at EU68, 30% premium to Heineken’s shares,
50/50 debt/equity financing ratio, deal would earn ROIC of
8.5%, EPS enhancement of 17%: RBC
* Raises Heineken to outperform vs sector perform, PT raised
to EU62 vs EU59
For Related News and Information:
First Word scrolling panel: FIRST<GO>
First Word newswire: NH BFW<GO>
--With assistance from Francesca Cinelli in Milan.
To contact the reporter on this story:
Gaurav Panchal in London at +44-20-7392-0511 or
gpanchal2@bloomberg.net
To contact the editors responsible for this story:
Andrew Rummer at +44-20-7073-3722 or
arummer@bloomberg.net
James Ludden