Aberdeen Asset Management, one of the larger institutional shareholders in the brewer SABMiller, has backed the group’s rejection of a $100bn (£65bn) takeover approach by Anheuser-Busch InBev.
“While we can see the potential benefits of a merger between the two companies we believe the public offer from AB Inbev significantly undervalues SABMiller and its long-term potential,” Aberdeen said in a statement after a phone conversation with the brewer’s management.
Devan Kaloo, Aberdeen’s head of global emerging markets, equities, said: “AB Inbev’s bid for SABMiller is welcome as it draws attention to the company’s undervaluation, but the bid is opportunistic and Aberdeen will not support the current offer – AB Inbev need to rethink their numbers.”
The fifth biggest investor, Kulczyk Investments, has said it rejected the bid. South Africa’s Public Investment Corp, which owns 3.1% of the brewer, as well as Investec, are also believed to be against.
Institutional shareholders own about 59% of SABMiller. SABMiller’s two major shareholders – Altria of the US and BevCo, owned by Colombia’s Santo Domingo family – appear to be split over AB InBev’s approach. Altria has publicly supported the proposal but BevCo has not.
Separately, SABMiller announced a drastically accelerated cost-cutting plan. The company, which makes Grolsch and Peroni, has announced plans to make annual savings of $1.05bn by 2020. The previous target was $500m by 2018.
The announcement follows a statement from the chief executive of AB InBev, Carlos Brito, in which he urged SABMiller shareholders to engage in talks to create a brewer that would produce a third of the world’s beer.
AB InBev went public with its £42.15 a share cash offer for SABMiller, which also makes Coors, on Wednesday after being rebuffed twice behind the scenes. Brito had said on Wednesday that SABMiller investors should call the chair to force him to discuss the terms.
A statement from SABMiller management said it was meeting with investors on Friday. The company has rejected the approach from AB InBev, saying it substantially undervalues the business.
“The measures we are announcing today are a continuation of our existing cost-saving programme,” the chief executive, Alan Clark, said.
“Whilst we are already a highly efficient business with strong Ebitda [Earnings before interest, taxes, depreciation and amortisation] margins of 38% across our 20 largest managed beer markets, we are continuing to remove duplication across markets, bringing specialist expertise in areas like procurement under one roof, and standardising common processes.
“It results in our markets being freed up to concentrate on what they do best – growing revenue with local consumers and customers.”
