Vivian D. Labbe
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Vivian D. Labbe in Mergers & Acquisitions,

Key facts to know about the SABMiller-InBev merger

In my previous post I suggested to buy both companies. But what shall we do now? 

After weeks of negotiation and months of speculation, beer giants SABMiller PLC and Anheuser-Busch InBev SA on Tuesday said they’ve agreed on the keys terms for a merger.

  • The price looks to be about $105 billion
  • The share price

The £44-a-share bid offered to the majority of SABMiller’s shareholders marks a 50% premium to the brewer’s trading level on Sept. 14, the day before media speculation about a potential merger erupted.

SABMiller shares jumped 8.5% to £39.31 on Tuesday in London trade after the takeover agreement, still putting it more than 10% below the offer price.

Shares of InBev rose 1.8% in Brussels, while U.S.-listed shares of the brewer climbed 1.9% in premarket action.

  • Watch out for the world’s largest brewer with 29% market share
  • Third-largest merger ever — and biggest takeover of U.K. company
  • By Oct. 28, put up or shut up

The two brewers have agreed on key terms for the merger, but still need to work out details for a formal agreement. The deadline under U.K. takeover rules for that was Wednesday, but SABMiller has requested an extension to the so-called put-up-or-shut-up deadline to Oct. 28.

So still buy both? Or wait?