AB InBev to Buy Remaining Grupo Modelo Stake in Deal Worth $20.1 Billion
06/29/2012| 03:07am US/Eastern
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BRUSSELS--Belgian beer company Anheuser-Busch InBev (>> AB INBEV) confirmed Friday it is acquiring the remaining stakes in Mexican brewer Grupo Modelo SAB (GMODELO.MX) for $9.15 a share in a deal worth $20.1 billion.
In a joint press statement, the companies said the merger will be "completed through a series of steps that will simplify Grupo Modelo's corporate structure, followed by an all-cash tender offer by AB InBev for all outstanding Grupo Modelo shares."
The companies said the tender price for the shares represents a premium of around 30% to Grupo Model's closing price on June 22.
AB InBev already owns a non-controlling 50% stake in Grupo Modelo and the combined company would be the largest in the industry with estimated 2012 revenues of $47 billion from operations in 24 countries, the companies said.
The Modelo sale to AB InBev ends a contentious history between the companies. AB InBev won its 50% Modelo stake through InBev's $52 billion acquisition in 2008 of Budweiser producer Anheuser-Busch, a deal that created the world's largest beer maker by sales. Anheuser had tried unsuccessfully to entice Modelo to merge with the U.S. brewing giant after it received the unsolicited approach from InBev, people familiar with the matter said at the time.
One question mark around a Modelo-AB InBev deal is whether regulators would approve it, given AB InBev's considerable market power in the U.S. and elsewhere as well as the strength of some Modelo brands, especially Corona.
"Grupo Modelo has been one of our most important partners for more than 20 years," said Carlos Brito, Chief Executive of Anheuser-Busch InBev. "There is tremendous opportunity from combining two leading brand portfolios and further expanding Grupo Modelo's brands worldwide through AB InBev's extensive global distribution network."
The companies said Grupo Modelo would keep its name and identity, would continue to be headquartered in Mexico City and would keep its local board.
The two companies said they believed the synergies from the merger would be worth more than an annual $600 million.
--Amy Guthrie in Mexico City contributed to this article
Write to Laurence Norman at Laurence.norman@dowjones.com
Corrections & Amplifications
This story was corrected at 0733 GMT because the original misstated the deal value in the headline. It should be $20.1 billion, not $20.1 million.
Stocks mentioned in the article :
AB INBEV
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