The standoff between two of the world’s biggest brewers intensified Thursday as Anheuser-Busch Cos. rejected a $47.5 billion buyout bid from rival InBev, setting the stage for a fight that could drag on for months.
The board of directors of St. Louis-based Anheuser-Busch unanimously rejected a $65-per-share takeover bid from InBev of Belgium, calling the proposal “financially inadequate and not in the best interests of Anheuser-Busch shareholders.”
Unfortunately this may be but a brief reprieve,
Anheuser-Busch’s response will not soften InBev’s resolve to take over America’s biggest brewer, according to B. Craig Hutson, a senior bond analyst at Gimme Credit.
“InBev’s not going to throw in the towel,” he said in an interview. “This just strengthens their resolve to go directly to shareholders.”
Anheuser-Busch’s position does not address the company’s “fundamental lack of top-line growth prospect,” Standard & Poor’s analyst Esther Kwon wrote after the company’s announcement. She said the rebuttal was unlikely to deter InBev’s interest, and that a “reasonable probability” remains of the deal being completed at $65 per share.
It would be a devastating blow to the City of St. Louis' image and economy if this deal is approved, In-Bev has a reputation for slashing jobs after take-overs. Unfortunately I think this deal will still go through. The bottom line is money and if In-Bev ups their offer I'm sure that the A-B Board and shareholders will not be concerned with the impact on the city or it's residents. They'll only be seeing those large dollar signs.
At this point though I'm glad that the sale has at least been stalled temporarily.
1 comment:
If I were a shareholder I'd be absolutely furious that this deal was rejected. This is not to demean the impact on the city of St. Louis and the workers for A-B, but functionally the board failed to do its job on this one, which is to protect the interests of the shareholders. This offer was a significant premium on even the historical high of the stock. I'd expect a shareholder suit forthcoming.
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