SABMiller shareholders can be treated as two separate groups when they vote on the company's takeover by Anheuser Busch InBev, a court in London ruled on Tuesday, granting a request from SAB for a split.
SABMiller shareholders can be treated as two separate groups when they vote on the company’s takeover by Anheuser Busch InBev, a court in London ruled on Tuesday, granting a request from SAB for a split.
The 79 billion pound ($103 billion) deal requires 75 percent approval by SAB shareholders. The largest two, which together control about 40 percent of the shares, have already signaled their support.
SAB requested that those two shareholders — cigarette maker Altria Group and Bevco, a vehicle of Colombia’s Santo Domingo family — be treated as a separate class.
The judge said it was reasonable for SAB to want to separate the classes to prevent potential delays or challenges at a later stage from dissenting shareholders who might challenge the vote as unfair.
A split would effectively raise the hurdle, since each class would have to approve the terms by three-quarters.
“I have jurisdiction to order a meeting of public shareholders to be summoned that does not include Altria and BevCo,” Justice Richard Snowden told the court on Tuesday.
The marriage of the world’s largest brewers was agreed last year with an offer of 44 pounds per share in cash for general shareholders and a discounted cash-and-stock offer aimed at Altria and Bevco to help them avoid large tax bills.
But the arrangement grew contentious this summer after a fall in the British currency increased the relative value of the cash-and-stock offer. Several shareholders, including activist hedge funds, pressured SABMiller to seek a new deal.
To head off protracted renegotiations, AB InBev sweetened its offer, which it declared “final”.
SAB backed the new offer, but said it would seek to separate the shareholder classes, which would mean that up to 85 percent of the shareholders need to approve the deal, rather than the straight 75 percent.
One prominent investor, Aberdeen Asset Management, had voiced opposition to the revised offer, saying it still undervalued the brewer of beers including Castle Lager, which has a strong presence in fast-growing markets of Latin America and Africa.
There are planned meetings of shareholders of each company on 28 September. If approved, the deal is expected to close on 10 October.
The new entity will be almost wholly controlled by executives from AB InBev, maker of beers including Budweiser and Stella Artois.
SABMiller’s shares were down marginally at 4375 pence at 1033 GMT while AB InBev’s stock was up about 1 percent at 112.2 euros.
($1 = 0.7663 pounds)