SABMiller Says U.K. Court Agrees Largest Shareholders Can Be Separate Class
August 23 2016 - 2:50PM
Dow Jones News
LONDON—SABMiller PLC on Tuesday said a U.K. court had agreed to
its proposal that its two largest shareholders be treated as a
separate class from the rest of its investors with regard to its
pending acquisition by Anheuser-Busch InBev NV.
AB InBev last month raised its offer for SABMiller to £ 45 a
share from £ 44 a share to head off a possible shareholder revolt
following a slide in the British pound after the country's vote to
leave the European Union.
SABMiller's board, after some deliberation, approved that
increase but said it would ask that its two biggest shareholders,
Altria Group Inc. and the Santo Domingo family, be treated as a
separate voting class.
The U.K. court decision reduces the percentage of share holdings
needed to block the deal to 15% from 25%, according to Stifel
Nicolaus & Co. analyst Mark Swartzberg, but he expects
SABMiller shareholders to approve the merger because many of its
largest shareholders also own shares of AB InBev or Molson Coors
Brewing Co., which is set to acquire SABMiller's interest in
U.S.-based MillerCoors LLC. Those companies stand to benefit from
acquiring SABMiller assets globally and in the U.S.
"Anyone who is in a cross ownership situation is going to be
very supportive of this transaction," Mr. Swartzberg said. Voting
against the deal "would be the equivalent of shooting yourself in
the foot."
Still, at least one large shareholder, Aberdeen Asset
Management, plans to vote against the deal, saying in a statement
Tuesday that it undervalues the company.
Altria and the Santo Domingos have committed to voting in favor
of the deal. The vote is scheduled for Sept. 28, and the deal is
expected to close Oct. 10.
The vote will take place about two months after AB InBev raised
its offer for SABMiller. It did so after the plummeting pound
against the dollar drove the value of AB InBev's cash offer to
SABMiller well below its alternative cash-and-share offer.
Initially, the cash offer was designed to be a premium.
Some investors had complained about the discrepancy between the
two offers. The cash -and -stock offer was designed for Altria and
the Santo Domingos and is subject to a five -year lockup period
that most regular shareholders are unable to stomach due to
liquidity requirements.
Tripp Mickle contributed to this article
Write to Saabira Chaudhuri at saabira.chaudhuri@wsj.com
(END) Dow Jones Newswires
August 23, 2016 14:35 ET (18:35 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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