By Ian Neubauer
InBev’s $47.5 billion bid for leading US brewer Anheuser-Busch is likely to prove successful as attempts by the Busch family and US lawmakers to foil the takeover lose steam in the face of market realities.
Earlier this week it was reported the Busch family, which founded the brewer in 1860, was attempting to buy an additional 50 per cent stake in Mexican brewer Grupo Modelo to make the merged companies too expensive for InBev to buy.
A number of US lawmakers have also voiced disapproval over the Belgium brewer’s takeover bid, claiming it raised antitrust issues by placing a large American company in foreign hands, as the SaveAB website testifies.
However, the AP reported lawmakers have little leverage to stop the deal, which will create significant value for the shareholders of both companies without endangering jobs and plants in the US.
Reports also surfaced today that Warren Buffet — one of the world’s richest men and the second largest Anheuser-Busch shareholder — has privately endorsed InBev’s bid to merge the companies and create what will in essence be the largest brewer and the fourth largest consumer company in the world.
InBev’s $47.5 billion offer represents $68.86 for every Anheuser-Busch share and an attractive premium over the company’s current share price of $65.07. It makes Buffet’s 4.9 per cent stake in the company worth $2.44 billion.
Anheuser-Busch’s board of directors have said they are considering InBev’s offer and would respond in due course.
Maker of the iconic Budweiser family of beers, Anheuser-Busch’s holds 48.5 per cent of the US beer market. But it has a marginal presence in Europe and Latin America that InBev’s takeover bid aims to address.
Likewise, InBev and its signature brands, Stella Artois and Beck’s, are small players in the US beer market, with the takeover bid representing significant opportunities to expand market share in North America.