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InBev Launches Takeover Bid for Anheuser-Busch

Belgian beer behemoth InBev NV, the second biggest brewer by volume in the world said yesterday it has made an unsolicited bid of $46 billion for the third biggest, Anheuser Busch Cos.

St. Louis-based A-B acknowledged that its board received the non-binding, $65-a-share cash offer, and would mull it over "in due course."

On a pro-forma basis for 2007, the combined company would generate global beer volume of 460 million hectoliters, net sales of $36.4 billion, and EBITDA of $10.7 billion, said InBev.

Fully aware that it was making a run for one of America's most-cherished iconic brands, InBev said that as part of its proposal, it envisions making St. Louis , MO the headquarters for the North American region, and the global home of the flagship Budweiser brand.

"In addition, InBev has proposed to name the combined company to evoke Anheuser-Busch's heritage, reflecting the strong history of Anheuser-Busch's key brands," the company said. "InBev would invite a number of Anheuser-Busch's directors to join the board of the combined company, and would seek to retain key members of Anheuser-Busch's management team across the organization. Given the limited geographical overlap between the two businesses and the efficiency of Anheuser-Busch's brewery footprint in the United States, InBev would maintain all of Anheuser-Busch's U.S. breweries."

Carlos Brito, InBev's c.e.o., added, "We also recognize the great contribution of Anheuser-Busch's wholesalers to the company's success, and would work closely with them, under the three-tier system, to create even greater excitement in the marketplace around the brands of both companies. The combination will create a stronger, more competitive, sustainable global company."

The two companies already have a successful U.S. distribution partnership for InBev's European premium import brands including Stella Artois, Beck's, and Bass.

According to a letter InBev sent to the Board of Anheuser-Busch, addressing president and c.e.o August A. Busch IV, the international brewer said the formal proposal was a follow-up to a discussion between the managements of the two companies in June 2.

InBev is a publicly traded company based in Leuven, Belgium, with origins dating back to 1366. It manages a porfolio of more than 200 brands including Stella Artois and Beck's.

Anheuser-Busch is the leading American brewer, holding a 48.5 percent share of U.S. beer sales. The company brews the world's largest-selling beers, Budweiser and Bud Light. Anheuser-Busch also owns a 50 percent share in Grupo Modelo, Mexico's leading brewer, and a 27 percent share in China brewer Tsingtao, whose namesake beer brand is the country's best-selling premium beer.
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