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Market Update

AB Inbev Lifts SABMiller Offer Again, Tesco Net Swings to a Loss

Author: Nigel Thomas
Last Update: 11:15 AM ET October 07 2015

4:00 PM Frankfurt – AB Inbev revised its proposal to acquire SABMiller to £42.15 per share in cash. Diageo sign an agreement for three asset swap deal. Sports Direct agreed to increase stake to full-control of New Zealand based Warrnambool. Tesco net swung to a loss.

In London trading, FTSE 100 index gained 55.24 or 0.9% to 6,379.94 and in Frankfurt the DAX index increased 185.03 or 1.9% to 10,085.46.

In Paris, CAC 40 index jumped 66.58 or 1.4% to 4,727.22.

Anheuser Busch Inbev SA gained 1.7% to €99.69 after the Belgium-based brewing company revised its proposal to the board of U.K.-based SABMiller Plc for £42.15 per share or $63.97 per share in cash from the earlier two proposals of about £40 per share and £38 per share in cash.

The revised proposal represents a premium of approx 44% to SABMiller''s closing price of £29.34 on September 14.

The SABMiller board rejected both prior approaches without any meaningful engagement but now the revised offer values the company as high as £68.24 billion or about $104 billion.

SABMiller said the latest proposal “still very substantially undervalues SABMiller, its unique and unmatched footprint, and its stand-alone prospects.”

Diageo Plc fell 0.7% to 1,806.50 pence after the U.K.-based alcoholic beverages maker agreed to sell its 57.87% stake worth about $781 million in Jamaica-based Desnoes & Geddes, the Red Stripe brewer and 49.99% stake in Malaysia-based and Singapore-focused beer business GAPL Pte Limited to Netherlands-based Heineken.

On other hand, Diageo lifted its stakes in Guinness Ghana Breweries Limited by acquiring of 20% stake in the business from Heineken, the deal increase Diageo''s stake in GGBL to 72.42%.

The company will receive £515 million from the asset swap deal book a profit of about £440 million and will use the funds to reduce the debt.

Sports Direct International Plc declined 4% to 744.50 pence after the U.K.-based sports and leisure products retailer agreed to acquire full control of Ireland-based clothing retailer Warrnambool owned by Northern Ireland-based homewares retailer Heatons for €47.5 million.

Tesco Plc jumped 2.4% to 196.69 pence after the U.K.-based supermarket chain and retail bank reported group sales in the first-half ending on August 29 dropped 2.3% from a year a go to £27.23 billion.

Net in the period swung to a loss from a year ago to £365 million compared to profit of £6 million and diluted loss per share swung to a 4.47 pence from diluted earnings per share of 0.07 pence.

The company said it is on track to for annual cost savings of £400 million from restructuring.

Sources: Data collected by 123jump.com and Ticker.com from company press releases, filings and corporate websites. Market data: BATS Exchange. Inc