Chris Hughes is a Bloomberg Gadfly columnist covering deals. He previously worked for Reuters Breakingviews, as well as the Financial Times and the Independent newspaper.

AB InBev's offer to buy rival brewer SABMiller has increased in value since it was unveiled in November. Oddly, that might be a problem.

The Belgian beer giant divided its 71 billion pound ($102 billion) bid into two alternative formats. In the first, investors could take 44 pounds in cash for each SAB share. In the second, they could receive a mix of cash and AB InBev shares worth 41.85 pounds at the time of announcement.

This part-stock alternative didn’t look terribly enticing back then. It was at a discount to the all-cash option, plus the stock component was subject to a five-year lock-up. But it had big attractions to those wanting to stay invested, including SAB’s biggest shareholders U.S. tobacco giant Altria and Colombia's Santo Domingo family. Altria said the structure was tax-efficient, while the Santo Domingos get to keep a strategic interest in the world's biggest brewer.

Fast forward to today and the part-stock alternative is worth about 46 pounds, a 5 percent premium to the 44 pounds all-cash offer. The weakness of sterling has boosted the relative value of euro-denominated AB InBev stock. It’s not the first time such a premium has emerged, as Bloomberg News reported in November.

Here for the Beer
AB InBev shares have risen this month

Right now, the 2-pound spread probably isn't big enough to make independent shareholders shun 44 pounds per share in cash for a large chunk of AB InBev shares they can't sell until 2021. But what if the premium widens and becomes seriously alluring? That’s possible if sterling weakens further around the UK’s referendum on European Union membership, or if AB InBev stock rallies.

If every SAB shareholder jumped at the part-stock option, their allocations would be scaled back pro-rata as AB InBev has capped it at 42 percent of the overall payment. Even so, Altria would end up with only 4.5 percent of the enlarged AB InBev instead of an anticipated 11 percent; the Santo Domingos would get 2.4 percent instead of an expected 5.7 percent.

This wasn’t the expectation at all when the takeover was hatched. But it’s hard to see a work around now. U.K. takeover rules mean AB InBev can’t squish the problem by changing the terms to bring the part-stock alternative down to its original 41.85 pounds per share. Doubtless everyone involved recognized that some SAB shareholders would want to take the part-stock alternative -- just not too many of them.

It’s going to be a tense few months if the part-stock alternative trades stubbornly over the cash option that was meant to be the default for most investors. The sight of this could lure a cheeky activist shareholder to demand AB InBev sweetens its entire offer, although AB InBev’s stock price would doubtless move down to undermine such an attempt.

In similar deals, such nail-biting would be avoided by wrapping the cash-and-shares offer in a "collar" that amended the number of shares included as their value changed, keeping the overall offer value constant. But that might have diluted the stakes of big AB InBev shareholders.

This deal was artfully constructed to satisfy multiple interests on both sides. But it may prove you can't please everyone all the time.

This column does not necessarily reflect the opinion of Bloomberg LP and its owners.

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Chris Hughes in London at

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James Boxell at