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This Bud’s For InBev
By JD Bluefield | July 11, 2008
Today MarketWatch announced that InBev is closer to acquiring BUD (Anheuser-Busch Companies, Inc) with a new (rumored) offer of $70/share. According to the article, the deal could go down as soon as this weekend, mostly spurred by Warren Buffett’s support of the deal. Because of the new bid price, shares have risen from their $61 hover, up to $66.
As I stated in InBev To Drink Up Bud?, I’m a shareholder of BUD stock and very excited about the deal. BUD is my second largest holding by value and have slowly aquired shares during low points in price. Since the last post about BUD, the price of the stock has risen $10/share, almost 20%.
Some shareholders have voiced displeasure at BUD’s Board of Directors attempt to prevent the deal, trying to buy Groupo Modelo, filing lawsuits, etc. but I believe that it was more of a filibuster to hold out for more money. It was clear early on that BUD’s Board and Busch family did not actually own enough shares to prevent the acquisition. Besides, Warren Buffett alone, via Berkshire Hathaway, already owns 5% of BUD and some family members are eager to sell. If this deal fell through, it would have been InBev’s choice.
Obviously the hold out for more was worth it. $70 is 7.7% over their previous $65 offer. I’d argue that’s a huge jump for essentially doing a whole lot of talking. Good work BUD board, way to take Maury Ballstein’s advice, “Screw Him! Hold out for more!” If you don’t know who that is, look it up.
It has been said that the deal could go down as early as this weekend. If that’s so, where is my “tender shares” proxy? I got my pen ready.
Topics: Investing |
One Response to “This Bud’s For InBev”
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July 12th, 2008 at 7:53 pm
This is a good deal for you and Buffet, but I think the Busch family wants to hold on to the glory of controlling Bud. They see it as a family business and they have an ego to be the top beer company, not necessarily the largest.