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The potential acquisition of Anheuser-Busch Cos. (BUD) by InBev become a very difficult situation to assess with any degree of confidence. First and foremost it will be stated that it is extremely difficult to conceive of a situation where the iconic BUD would agree to non-U.S. ownership for a variety of obvious reasons. Although just about every company has a sale price, this concept is not likely to apply in this scenario, regardless of shareholder sentiment.

Second, the prospect of BUD's market value dropping dramatically from a failed InBev takeover attempt (a la Yahoo (YHOO) in the Microsoft (MSFT) situation) may indeed be a compelling factor at the moment, but this should certainly be outweighed by the long-term implications.

Unlike many industries, such as the Internet, BUD's products will continue to thrive and be a major part of the U.S. social fabric (for better or worse) well into the foreseeable future. In other words, there is absolutely no rationale whatsoever for this transaction to take place from the perspective of BUD or its shareholders.

Finally, if InBev has any intentions of going hostile in this situation, the public and political repercussions would on a scale that would ultimately harm InBev's image and business in the U.S. It must be assumed that InBev is fully aware of this concept and will move forward with extreme caution.

Not surprisingly, reports are now surfacing that BUD has engaged in discussions with Modelo (Mexico) with respect to a potential combination as a means of dissuading InBev. This is obviously a rational move by BUD, although one that is not entirely necessary at this stage.

Currently, this publication can foresee no scenario in which InBev will actually succeed in its unsolicited offer, even if it increases its offer to an unusually high level.

Disclosure: We have no positions of any kind, in any security. We are a completely neutral source of research and analysis.

Source: Status Report: Anheuser-Busch - InBev