‘Megabrew’ rebels warned of share price hangover if £79bn deal goes flat
SHAREHOLDERS resisting the £79billion ‘Megabrew’ takeover of beer giant SABMiller by US rival AB InBev have been warned shares in both groups could fall sharply if the deal fails – as hedge funds cash out and months of planning go to waste.
In a stark warning, sources close to the deal said hedge funds – known for their rapid trading patterns – now own almost a fifth of the shares in SABMiller, whose beer brands include Miller and Foster’s, and would sell out quickly if the deal failed to go through.
They also said that nine months of integration planning and efforts to meet regulatory hurdles in global territories including China have been a draw on resources which would be wasted if the deal was scrapped.
Resistance to the deal prompted AB InBev, maker of Stella Artois and Budweiser among others, to raise its offer by £1 to £45 a share on Tuesday. But shareholders in SABMiller, including Aberdeen Asset Management, argue that is still not enough.
Analysis by Citigroup said the shares could fall to around £39 if the deal dissolves, saying: ‘The question they will be asking shareholders is whether they prefer £45 or £39.’
Late on Friday, SABMiller’s board agreed to recommend the improved AB InBev offer to its shareholders, which could now be completed by the end of this year if shareholders agree.
Aberdeen still insisted the deal was unacceptable. Several other former rebels, including activist fund Elliot Management, have moved to support the bid since the raised offer.