AB InBev ups offer for SABMiller after Brexit pound slump

LONDON — Budweiser maker Anheuser-Busch InBev increased its cash offer for SABMiller to blunt a revolt by investors who had seen the relative value of their payout plummet as the pound declined following Britain’s vote to leave the European Union.

AB InBev on Tuesday sweetened its bid by about $1.31 a share to appease smaller investors who complained that they were now receiving less for their shares than SABMiller’s two biggest shareholders, who were offered a cash-and-share deal. The new offer values the transaction at $103.8 billion.

SABMiller’s board in November accepted, in principle, a merger that seeks strength in size, combining the world’s two largest brewers into a company that would control nearly a third of the global market.

But AB InBev shares, which are denominated in euros, have risen 3.2 percent since then and the pound plunged against the European currency after the referendum on Britain’s exit from the EU. That reduced the value of the cash offer compared with the cash-and-stock option tailored for U.S. tobacco company Altria and BevCo, an investment vehicle of the Santo Domingo family, which together own about 40 percent of SABMiller and wanted to remain shareholders of the new company.

Aberdeen Asset Management, whose stake in SABMiller is in excess of one percent, on Tuesday made plain its unhappiness with both the new cash offer and the overall situation. The offer undervalues SABMiller and favors the company’s two biggest shareholders, the firm said.

“The revised deal remains unacceptable,” it said in a statement.

Aberdeen Asset Management said it had engaged with SABMiller’s board on the “differential” treatment of shareholders and that the way that the “value of the partial share offer has diverged from the cash offer has compounded our discomfort.”

AB InBev has received regulatory approval for the deal in a number of jurisdictions, most recently in the United States. Regulators in China have yet to offer their view.

RBC Capital Markets analyst James Edwardes Jones described the people who were agitating as being “relatively small shareholders,” and that there would not be further increases to the pot.

“It was a final offer,” he said.