Inbev, the Belgian-Brazilian brewer, and Budweiser-owner Anheuser-Busch have agreed to merge to form the world’s biggest brewing company. The brewer sealed this deal this morning (July 14) after its raised offer of $52bn (£26bn) offer was recommended by the AB board.
AB chief executive August Busch IV withdrew his opposition to the takeover and recommended the improved offer in return for a seat on the enlarged company’s board.
The new company will be called Anheuser-Busch Inbev and be led by Inbev chief executive Carlos Brito, who takes the same title. The rest of the board will comprise the existing InBev board, AB president and chief executive Busch IV and one current or former director from the AB board.
Inbev, which owns the Stella Artois and Becks brands, persuaded AB to enter talks on Friday after upping its offer from $65 a share to $70 a share and pledging to focus its expansion efforts on turning Budweiser into a global brand. It predicts it can make annual cost synergies of at least $1.5bn by 2011, despite promising not to close any of AB’s ten American breweries. Inbev also says it does not foresee “any significant regulatory issues”.
The combined company will be one of the top five global consumer products companies, with net sales of $36.4bn and underlying earnings of $10.7bn, according to Inbev.
The brewer approached AB more than a month ago, with the American company rejecting an opening $47bn offer as “financially inadequate”.
The deal marks an end to the AB’s 156-year history as a family-run, American company.