SABMiller puts AB InBev integration work on hold
SABMiller has told employees to stop working on integrating operations with those of Anheuser-Busch InBev, the Belgian brewer, which on Tuesday raised its takeover proposal for its smaller rival to £79bn.
In a memo seen by the FT, Alan Clark, chief executive, told employees on Tuesday to “pause” integration planning with AB InBev, until the SAB board meets to decide whether it will accept the new offer.
He said: “The convergence planning workstreams are being paused pending the board’s considerations of the revised offer. This means that there should be no contact with AB InBev with immediate effect, and all meetings and calls will be postponed until further notice.”
The brewer of Budweiser and Stella Artois bumped up its offer to stem a growing SAB investor rebellion over the terms of the deal, following a sharp drop in sterling’s value.
The London-listed brewer recommended AB InBev’s previous offer made last October. It has been working with it on integration planning since February, to ensure a smooth handover for what would be the third-largest takeover deal in corporate history.
The work has focused on areas such as financial operations, IT and procurement.
Some investors, including Elliott Management and Aberdeen Asset Management, have criticised the structure of the deal.
A cash-and-shares offer designed for SAB’s two largest shareholders — Altria and BevCo, which hold 41 per cent of the shares —- has risen sharply in value compared to the cash offer aimed at other shareholders.
The partial share offer is worth £51 a share, up from £39 last October, while the cash offer has been raised to £45 a share, from £44 previously.
SABMiller is talking to shareholders this week before convening a board meeting, possibly for Friday.
Jan du Plessis, SABMiller chairman, told shareholders at the group’s annual meeting last week that the board would review the terms of AB InBev’s bid and “look at the transaction as a whole,” but only after the proposed takeover was cleared by Chinese authorities, a decision which is expected imminently.
Mr Clark said in the memo: “I appreciate this will cause lots of internal and external speculation. However, please stay focused.”