SABMiller Jumps on Speculation of Imminent Offer From AB InBev

Why Does InBev Want to Take Over SABMiller?
  • Stock advances as much as 4.3% in early London trading
  • Brewer's Johannesburg-listed shares extend record high

SABMiller Plc jumped in early London trading amid speculation that Budweiser maker Anheuser-Busch InBev NV is close to submitting a bid.

The stock gained as much as 4.3 percent to 3,743.5 pence, extending Friday’s 2.4 percent advance, after the Times and Telegraph newspapers said AB InBev may announce a formal offer for the Peroni brewer as early as this week. The world’s biggest brewer said Sept. 16 it may bid for its nearest competitor.

According to the average of five analyst estimates compiled by Bloomberg, AB InBev may pay more than 4,200 pence for each share of its rival, which would value London-based SAB at about 68 billion pounds ($103 billion).

SABMiller’s Johannesburg-listed shares rose as much as 4.6 percent, extending a record high.

SABMiller 2-day price graph
SABMiller 2-day price graph

The acquisition of SABMiller would be the biggest in the industry’s history and cap more than a decade of consolidation across brewing companies. A potential combination of the beermakers has been seen as likely for years as they have limited geographical overlap outside the U.S. and aren’t controlled by a family foundation like competitors Heineken NV and Carlsberg A/S.

SABMiller is said to be open to talks and would consider a bid that provides good value for shareholders, according to people with knowledge of the matter.

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