InBev and Anheuser-Busch

In early June 2008, Belgian-based InBev NV launched an unsolicited $46.4 billion bid to acquire Anheuser-Busch Co., owner of the 132-year-old Budweiser brand. If completed, the combination would create the world’s largest brewer with sales of about $36 billion annually. The initial response from Anheuser was noncommittal and said, “The company will pursue the course of action that is in the best interests of Anheuser-Busch’s stockholders.” On June 26, Anheuser’s board formally rejected InBev’s original proposal of $65 a share, saying it substantially undervalued the company. In mid-July, InBev raised its offer to $70 a share, and the Anheuser board voted to accept the deal, recognizing that a better offer was unlikely. The $70 price represented a substantial premium for Anheuser shareholders. InBev management now has to prove to their shareholders that the premium was justified.