May 27 (Bloomberg) -- SABMiller Plc, the world's third- largest brewer, rose the most in almost three years in London trading after the Financial Times reported that InBev NV is weighing a merger between the companies.

SABMiller climbed 6.9 percent, paring a gain of as much as 8.2 percent. InBev, the world's biggest brewer by sales, is considering an SABMiller deal as a ``plan B'' should its potential $46 billion approach to Anheuser-Busch Cos. fail, the FT said on May 24, citing an unidentified person familiar with the situation.

Leuven, Belgium-based InBev, which in 2005 bought control of Brazil's Cia. de Bebidas das Americas for $11.2 billion, generates less than 1 percent of its total volume in the U.S. Last year, London-based SABMiller agreed to merge its Miller business in the world's biggest economy with the local unit of Molson Coors Brewing Co. to revive sales.

``What InBev really wants is to penetrate the U.S.,'' said Christopher Gower, an analyst at MF Global Securities in London, who advises selling SABMiller and buying InBev stock. ``It's about getting synergies there and SAB's Miller brand is showing signs of weakness.'' He'd prefer an InBev combination with Anheuser, which controls almost half of the U.S. market, he said.

SABMiller rose 85 pence to 1,309 pence in the British capital, the biggest gain since July 19, 2005. InBev fell 1.9 percent in Brussels trading today and is the second-worst performer this year in the seven-member Bloomberg Europe Beverages Index, dropping almost 18 percent.

Short Positions

Anheuser-Busch shares were little changed at $56.62 at 1 p.m. in New York Stock Exchange composite trading. The stock gained 7.7 percent on May 23 after the Financial Times' Alphaville blog said the St. Louis-based company may receive a bid valued at $46 billion from InBev.

Marcel Hooijmaijers, an analyst at Landsbanki Kepler in Amsterdam, said investors unwinding so-called short positions may also have driven SABMiller shares higher today. Short selling occurs when investors aim to profit from a decline. News suggesting a company may be bought can prompt those short sellers to buy back stock, driving the shares higher.

SABMiller spokesman Nigel Fairbrass and InBev spokeswoman Marianne Amssoms both declined to comment on the FT's article.

In the U.S., SABMiller ``stabilized'' its market share last year after losing share to Anheuser-Busch in the previous years, because of ``price-based competition,'' Fairbrass said by phone. The company said May 15 second-half profit rose 24 percent, helped by volume growth in Poland and Russia and Romania.

Latin America

SABMiller gets half its profit in Europe and Latin America and about 11 percent in the U.S. InBev dominates Brazil and has large operations in Europe and China.

An InBev tie-up with SABMiller is ``very unlikely,'' said Rob Mann, an analyst at Collins Stewart in London with a ``sell'' recommendation on SABMiller. The companies have different strategies for increasing growth, he said. InBev has focused on lowering costs and SABMiller on increasing revenue.

InBev and SABMiller have had informal talks about a tie-up, though negotiations were limited by a U.S. Justice Department review of SABMiller's agreement to merge its U.S. unit with those of Molson Coors Brewing Co., the FT said. SABMiller's talks with InBev could progress after the Molson Coors transaction receives regulatory approval within weeks, the newspaper said.

``We view reports as credible, and judge prospects of a deal better than 50 percent,'' Investec Securities analysts said in an e-mailed note to clients today. An Anheuser-InBev merger is more likely than a deal involving SAB, they said.

To contact the reporter on this story: Joram Kanner in Amsterdam at jkanner@bloomberg.net; Keith Campbell in London at k.campbell@bloomberg.net.

Last Updated: May 27, 2008 13:06 EDT