July 14 (Bloomberg) -- InBev NV agreed to buy Anheuser- Busch Cos. for $49.9 billion to become the world's biggest brewer, the Wall Street Journal reported, citing unidentified people familiar with the situation.

The $70-a-share takeover of St. Louis-based Anheuser-Busch is the second-biggest of a U.S. consumer-goods company and ends a month of court fights and public disputes over the future of the 156-year-old maker of Budweiser. Leuven, Belgium-based InBev will change its name to Anheuser-Busch Inbev, and Anheuser will have two seats on the board, the Journal said.

InBev, which has more annual sales than any other brewer, will overtake SAB Miller Plc as the world's largest beermaker by volume as it puts Anheuser-Busch's Budweiser brand together with its Bass ale and Beck's lager.

Nina Devlin, an InBev spokeswoman who works at Brunswick Group LLC, and Maureen Roth and Terri Vogt, spokeswomen for Anheuser-Busch, didn't return messages seeking comment.

Anheuser-Busch, which rose 26 percent after reports of InBev's planned bid in May, gained $5.29, or 8.6 percent, to $66.50 on July 11. InBev added 3.05 euros, or 7.4 percent, to 44.50 euros in Brussels trading.

At $70 a share, InBev would be paying about 11 times Anheuser's 2009 projected earnings before interest, taxes depreciation and amortization, based on analysts' estimates compiled by Bloomberg. SABMiller Plc, the world's third- largest brewer, paid about 14 times Ebitda for Royal Grolsch NV last year, Petercam SA's Kris Kippers said.

Buffett's Stake

Billionaire investor Warren Buffett's Berkshire Hathaway Inc. is Anheuser-Busch's second-largest shareholder with a 5 percent stake. Barclays Plc owned 6.1 percent of the U.S. brewer as of March 31, according to data compiled by Bloomberg.

InBev Chief Executive Officer Carlos Brito has said the combined company's more than $36 billion in annual sales and 12 billion gallons of shipments also would allow the negotiation of better terms from suppliers as expenses soar for barley, hops, electricity and metal for beer cans.

InBev may have trouble lowering costs given potential resistance from Anheuser-Busch's unions and the low market overlap between the two companies, according to Wachovia Securities Inc. analyst Jonathan Feeney.

The Belgian company, the maker of Stella Artois lager and Leffe Belgian ales, hired Lazard Ltd., JPMorgan Chase & Co. and Deutsche Bank AG to advise it in the monthlong fight. Anheuser- Busch's advisers include Goldman Sachs Group Inc., Merrill Lynch & Co., Citigroup Inc., and Moelis & Co.

Borrowing Cash

InBev's lenders for the proposed bid are Banco Santander SA, Deutsche Bank, Barclays Plc, JPMorgan, Royal Bank of Scotland Group Plc, BNP Paribas SA, Fortis, ING Groep NV, Bank of Tokyo-Mitsubishi UFJ and Mizuho Corporate Bank Ltd.

InBev, which traces its roots to 1366, took its current form in 2004 when Leuven-based Interbrew SA bought Sao Paulo- based Cia. de Bebidas das Americas, or AmBev, in an $11 billion transaction.

Through 20 years of acquisitions, InBev expanded from family-owned Flemish beers to surpass Anheuser-Busch as the largest brewer by sales while dominating Latin America.

The Belgian company is seeking control of half of the U.S. beer market and aims to grow in China, where Anheuser-Busch owns 27 percent of Tsingtao Brewery Co., the country's second-largest brewer.

The U.S. brewer spurned InBev's original $46.3 billion proposal on June 26 as ``financially inadequate,'' while keeping the door open for a higher offer from InBev or another suitor. That rejection came three hours after InBev made its bid hostile and announced plans to fire the St. Louis-based brewer's directors.

Family Fortunes

The Busch family, who don't own enough stock to block a bid, were split over the initial offer. Andrew D. Busch, an uncle of CEO August Busch IV, said last month that he wants the brewer to stay based in St. Louis and continue as a ``strong company.'' Another uncle, Adolphus Busch IV, urged Anheuser's board to accept the InBev proposal.

The Anheuser-Busch acquisition would be second among consumer-products acquisitions to Procter & Gamble Co.'s purchase of Gillette Co. for $57 billion in 2005. It would be the biggest cash acquisition on record.

To contact the reporters on this story: Zachary Mider in New York at dstanford2@bloomberg.net; Duane D. Stanford at dstanford2@bloomberg.net

Last Updated: July 13, 2008 22:33 EDT