Tue, Sep. 20, 4:28 PM
- Shareholders holding sizable positions in SABMiller (OTCPK:SBMRY) are in the spotlight as the company's meeting on September 26 approaches. The vote on the Anheuser-Busch InBev (NYSE:BUD) merger will be the main event of the SABMiller gathering.
- Large institutional shareholders such as BlackRock and State Street Global Advisers are seen approving the deal because they also own interests in BUD and Molson Coors, but the hedge fund vote is harder to forecast. Some hedgies may gamble and skip out on voting by declining to convert their options and derivatives to save on the exercise tax.
- Another reason that the merger vote may be closer than anticipated is that both Altria (NYSE:MO) and the Santo Domingo family are excluded from having a say.
Wed, Sep. 14, 9:39 AM
- In a fresh note to investors, Susquehanna analyst Pablo Zunaic tackles the huge question of if PepsiCo (NYSE:PEP) or Coca-Cola (NYSE:KO) will be the next major target for Anheuser-Busch InBev (NYSE:BUD) down the road.
- Though it's highly speculative at this point, PepsiCo appears as the more logical choice if the pros and cons are lined up. Snippets from Zuanic's note are posted below.
- On accretion value: "An acquisition of PEP drinks would be over 20% EPS accretive (one quarter stock funded), while a bid for KO would not (all cash a KO bid would push gearing to 8x)."
- On global markets: "True, overseas KO is much larger than PEP, but that may be a moot point as the KO overseas business is mainly in the hands of independent bottlers (so is PEP’s except for Russia). But we think PEP bottlers in markets like Mexico, China, India, and Canada, could be more reasonable acquisition targets for BUD down the road (than KO bottlers) and would actually provide relevant scale up benefits."
- On distribution: "In terms of bringing scale to its beer distributors we note KO and PEP are similar in size in the US (in terms of end unit cases of NARTDs), but more importantly the PEP drinks business is 75% PEP owned while by end of 2017 KO’s US operating business (bottling and distribution) will all be in the hands of independent bottlers."
- On the Buffett factor: "Those expecting a bid for KO say so in part because of the Warren Buffet presence (holder of a 9.3% stake in KO), but would he really want that to be his legacy (i.e., the man that sold the Coke?)."
- Current market caps: BUD $194B, KO $178B, PEP $149B.
- Name check: Financing the deal is one matter, but negotiating a new corporate name for the mega-beverage entity could be just as engaging.
Tue, Sep. 13, 2:29 PM
- Jefferies initiates coverage on Anheuser-Busch InBev (BUD -1.9%) with a Buy rating.
- Analyst Edward Mundy thinks the company is understating the cost savings generated through the SABMiller deal.
- "Our 12 month PT EUR 130 is predicated on the realisation of USD 3bn cost saves on the SABMiller deal vs guidance 1.4bn," writes Mundy. ABI closed at €109.25 in Brussels today.
- In the U.S., BUD trades at $122.91 at last check vs. a post-Megabrew announcement high of $132.91.
Sun, Sep. 11, 9:54 AM
- AB InBev (NYSE:BUD) is bringing its alcohol expertise to the carbonated-water category with the acquisition of SpikedSeltzer creator Boathouse Beverage.
- The acquisition highlights the pressure on brewers to expand beyond beer, which has been losing share of the total U.S. alcohol market to liquor and wine over the past 15 years.
- Financial terms of the deal weren't disclosed.
Fri, Sep. 9, 8:48 AM
- Anheuser-Busch InBev (NYSE:BUD) picked up another brewery this week with the acquisition of Brouwerij Bosteels. Bosteels has been owned by the same family since 1791 which gives it a similar history as the Anheuser-Busch part of the InBev empire.
- The company reportedly paid $225M for the Belgium-based maker of Tripel Karmeliet, Kwak, and Deus beers.
- An AB InBev spokesperson says the company will focus on the Europe export market with the new brands and dabble with a small penetration in the U.S.
- Anheuser-Busch InBev press release (.pdf)
- Shares of BUD have traded around the $125 level for the last few weeks amid a calm post-Brexit, post-Megabrew wrangling backdrop.
Wed, Sep. 7, 8:20 AM
- Beer industry heavyweights Anheuser-Busch InBev (NYSE:BUD), Heineken (OTCQX:HEINY), Asahi Group Holdings (OTC:ASBRY), and Kirin Holdings (OTCPK:KNBWY, OTC:KNBWF) are in the group of active bidders for Saigon Beer Alcohol Beverage Corp.
- Saigon Beer Alcohol Beverage Corp. (known as Sabeco) is the largest beer seller in Vietnam with a 40% market share. The Vietnamese government holds a stake of 89.5% in the company.
- The deal price could end up north of the $2B mark.
Fri, Aug. 26, 10:54 AM
- Shares of Anheuser-Busch InBev (NYSE:BUD) are up 1.23% after the company tipped off that it will reduce thousands of jobs after SABMiller is absorbed.
- Perhaps as much as any large multinational, AB InBev is known for laserlike M&A efficiency as seen with both the Anheuser-Busch (2008) and Modelo (2013) deals in the past.
- Most analysts think that SABMiller shareholders are very likely to approve the merger deal when they formally vote on September 28.
- While shares of BUD have rallied a very respectable 13% over the last six months as Megabrew has headed toward the finish line, it's been beer players Molson Coors (+20%) and Craft Brew Alliance (+146%) that have seen powerful rallies.
Fri, Aug. 26, 5:34 AM
- Around 3% of the combined workforce of Anheuser-Busch InBev (NYSE:BUD) and SABMiller (OTCPK:SBMRY) could be laid off in the three years following the completion of their merger. That 3% though, excludes sales and front-office supply staff, as AB InBev says regulatory restrictions prevent it from moving forward with integration plans at the moment.
- Combined, the two companies currently employ about 220K.
Tue, Aug. 23, 7:08 AM
- A court in the U.K. rules that Altria (NYSE:MO) and Bevco can be treated as a separate class from other SABMiller (OTCPK:SBMRY) shareholders in connection with a vote on the company's merger with Anheuser-Busch InBev (NYSE:BUD).
- Both classes will need to approve the terms of the merger by a 75% rate.
Sat, Aug. 6, 11:06 AM
- The heavy investment by the automobile industry on self-driving technology could end up benefiting restaurants and beer companies, according to some conjecture from Morgan Stanley.
- The math from MS works out like this: You take the 39% of the 2.1B global drinking population that drives and factor in that their average intake of alcohol would increase from 1.5 drinks to 2.5 drinks per week with a self-driving car to haul them home. Assign a value per drink of $2.32 and you have an incremental annual benefit of $98B for the restaurant and alcohol industry.
- There's conflicting data on the impact of Uber (Private:UBER) and Lyft (Private:LYFT) on alcohol consumption, so the Morgan Stanley theory has a ways before playing out. Still, Morgan's Adam Jonas is convinced the automobile industry is heading toward a future of fully autonomous transport in which the driving experience is nostalgic. The buying habits of younger millennials support the thesis to a degree.
- During the Tesla Motors (NASDAQ:TSLA) earnings call earlier this week, Elon Musk predicted global demand for self-driving cars would reach 2.5B. Execs with General Motors (NYSE:GM), BMW (OTCPK:BMWYY), and Toyota (NYSE:TM) also talked autonomous models in their CCs.
- If Jonas and Musk are anywhere close to correct, the list of companies that could benefit from the autonomous push includes Buffalo Wild Wings (NASDAQ:BWLD), Dine Equity (NYSE:DIN), Anheuser-Busch InBev (NYSE:BUD), Molson Coors (NYSE:TAP), Boston Beer (NYSE:SAM), Brinker International (NYSE:EAT), Bloomin' Brands (NASDAQ:BLMN), Ignite Restaurant Group (NASDAQ:IRG), Kona Grille (NASDAQ:KONA), Diageo (NYSE:DEO), Constellations Brands (NYSE:STZ), and Craft Brew Alliance (NASDAQ:BREW).
- Related ETF: BITE.
Thu, Aug. 4, 4:27 AM
- After its MegaBrew deal is completed, AB Inbev (NYSE:BUD) plans to adopt a leadership team that will be composed of zone presidents and functional heads reporting to CEO Carlos Brito.
- The brewer will continue to be based in Leuven, Belgium, while managing its day-to-day operations from New York, and existing SABMiller (OTCPK:SBMRY) hubs in Miami, Hong Kong and Beijing will be phased out within a few months after completion of the combination.
Mon, Aug. 1, 2:44 PM| Mon, Aug. 1, 2:44 PM | 7 Comments
Fri, Jul. 29, 11:30 AM
- The board at SABMiller (OTCPK:SBMRY) officially throws its support behind the acquisition of the company by Anheuser-Busch InBev (BUD +2.4%). The £79B ($104.94B) offer was at the "lower end" of the company's acceptable range.
- A-B landed its last required regulatory approval earlier today in China after raising its offer for SABMiller at the beginning of the week.
- The deal brings together a large number of beer brands into the same corporate house even after key divestitures across regions. A partial list of the Megabrew assets includes Bud Light, Budweiser, Michelob, Rolling Rock, Busch, Shock Top, Natural, Goose Island, Blue Point, Four Peaks, Grolsch, Pilsner Urquell, Foster's Lager, and Castle Lager.
- Shares of MolsonCoors (NYSE:TAP) are up 3.32% with the company now set to control MillerCoors in the U.S. by itself. SABMiller stakeholder Altria (MO +1%) also perked up after the announcement.
Fri, Jul. 29, 7:36 AM| Fri, Jul. 29, 7:36 AM | 2 Comments
Fri, Jul. 29, 5:45 AM
Fri, Jul. 29, 4:47 AM
- Anheuser-Busch InBev (NYSE:BUD) is due to disclose Q2 earnings this morning.
- Analysts expect the beer giant to report revenue of $10.82B and EPS of $1.09. The beer giant's results in Mexico (positive F/X) and Brazil (pre-Olympics buildup) could help prop up sluggish sales in the U.S.
- Though analysts expect limited commentary from AB InBev executives on the MegaBrew deal, investors will be searching for hints of forward motion. Investors are waiting for the SABMiller board to weigh in on the new takeover offer and for China to complete its regulatory review.