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Megabrew: Influential shareholder adviser group Glass Lewis backs £79bn AB InBev takeover of SABMiller

Francesca Washtell
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The advisory group has raised a Glass (Lewis) to the deal (Source: Getty)

Global investor advisory group Glass Lewis has backed Anhesuer-Busch InBev's (AB InBev) £79bn takeover of British drinks giant SABMiller.

Glass Lewis has urged SABMiller shareholders to vote in favour of the takeover at the company's vote on the deal on 28 September.

The group said the cash offer, which has been dismissed by other shareholders such as Aberdeen Asset Management, was a fair price and represented a historically high valuation multiple.

"Based on these factors, along with the unanimous support of the board, we believe the proposed acquisition is in the best interests of shareholders," the firm said in its report.

Read more: Canadian Mounties among bidders eyeing up SABMiller's European beers

On Monday, Institutional Shareholder Services (ISS) advised SABMiller investors to back the mega-merger.

Last month, the UK's High Court ruled that SABMiller shareholders can be treated as two classes when they vote on the deal, dubbed "megabrew".

Smaller investors will now vote separately from Bevco, owned by Colombia's Santo Domingo family, and cigarette maker Altria on the increased offer, which AB InBev topped up from £44 per share to £45 per share after activist investors complained the structure of the offer unfairly favoured the two institutional shareholders.

A cash-and-stock option is technically available to all shareholders.

Read more: Hundreds of UK jobs at risk as AB InBev announces Belgium move for SABMiller HQ

However the AB InBev shares on offer cannot be sold for five years and means most public investors must opt for the all-cash option instead, leaving Altria and Bevco to benefit from the cash-and-stock version.

Altria and the Santo Domingo family gave the deal the all-clear in August, leaving just smaller investors to decide on the merger.

SABMiller's board unanimously urged its shareholders to back the deal in late July.

If investors give it the go-ahead, the merger is expected to complete on 10 October.

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