Belgian brewer InBev, the
world's second-biggest by volume, is working on a $46 billion
bid for Anheuser Busch, a Financial Times report said, boosting
the U.S. brewer's stock price.
At 12:00 p.m. EDT (1600 GMT), Anheuser Busch shares were up
6.9 percent at $56.15. InBev closed down 2.9 percent at 48.88
euros. The DJ Stoxx European food and beverage index was down
In the report on its Alphaville blog on the newspaper's
website, the FT cited sources as saying the approach was
expected to be pitched at $65 a share but while extensive work
was being carried out InBev was not about to "push the button."
The report also said a financing package of $50 billion had
been provisionally arranged through JPMorgan and Santander and
that the bid had been discussed at an InBev board meeting on
April 28 and at a meeting on Thursday.
InBev said it would not comment on the report. Anheuser was
not immediately available but has a policy of not commenting on
market rumors. A JPMorgan spokeswoman declined to comment.
Rumors have repeatedly surfaced over a possible bid by
InBev, brewer of Stella Artois, Beck's and Brahma, for the U.S.
giant, whose output includes Budweiser and Bud Light.
"Anheuser-Busch shares and options have been active
throughout the week due to rumors of a takeover," said William
Lefkowitz, options strategist at brokerage firm vFinance
Investments in New York.
WHEN NOT IF
Gerard Rijk, a beverage sector analyst at ING in Amsterdam,
said he felt the deal was a question of when, rather than if, a
view shared by others following the sector.
"The consolidation has to continue. There are strategic
synergies in North America and China," he said.
InBev, formed from the 2004 merger of Belgium's Interbrew
with Brazil's AmBev, has a mature western European market and
growth in Latin America, notably in key market Brazil, as well
as in eastern Europe and Asia.
Anheuser is dominant in the United States, has a 50 percent
stake in Mexico's Grupo Modelo and a strong presence in China,
through its 27 percent holding in Tsingtao.
A deal would expand InBev's geographic presence, with
little obvious overlap, boost its premium brands and see its
cost-focused managers squeeze savings from the U.S. operations.
InBev already has a deal with Anheuser-Bush to distribute
InBev beers in the United States.
However, InBev shares have fallen some 18 percent in the
past five weeks, partly as a result of weaker than expected
Chief Executive Carlos Brito has said being the biggest is
not the ultimate goal, but InBev is aware that it was overtaken
as the world's largest brewer by SAB Miller last year.
Rivals Heineken and Carlsberg have also increased their
size with their joint purchase of Scottish and Newcastle.
Credit Suisse said in a research note that the $65 a share
bid mentioned in the report represented fair value, although
would probably have to be higher if it were a hostile approach.
It added that Anheuser could, in defense, seek to make
itself larger by taking full control of Grupo Modelo.
(Reporting by Mark Potter in London, Philip Blenkinsop,
Julien Ponthus and William Schomberg in Brussels, Martinne
Geller in New York and Doris Frankel in Chicago; Editing by
Mike Elliott, Greg Mahlich)
Funds managed by private equity firm
Candover (CDI.L) and investment bank Goldman Sachs (GS.N) have
raised their offer for Expro International (EXR.L), valuing the
UK oil services company at 1.71 billion pounds ($3.4 billion).
The move followed news earlier on Friday that Expro had
received a higher approach at 1,525p per share from U.S. rival
The independent directors of Expro said they recommended
the new cash offer from Candover and Goldman Sachs, having on
April 17 agreed to a bid of 1.61 billion pounds worth 1,435
pence per share from the same party.
Fast-growing Expro had said the proposal from Halliburton,
the world's second-biggest oil services company behind
Schlumberger (SLB.N), was subject to conditions.
Expro shares, up six fold in the past four years, were up
5.1 percent at 1,620 pence following the revised agreement with
Candover and Goldman.
Oil and gas industry services providers such as Expro have
benefited as record energy prices prompt companies to boost
spending on exploration and development of reserves.
This has attracted bidding interest from private equity
firms and trade buyers for oil field services firms, with the
tussle for Expro following other deals in the sector.
On April 18, the day after Expro agreed to the Candover and
Goldman bid, Halliburton announced it was mulling a counter
bid, saying, "The offer would be based on Halliburton's
analysis of synergy and other benefits that could be derived
from combining its business with Expro and consistent with the
company's previously espoused strategy of making acquisitions
which are accretive to shareholder value."
Evolution Securities analyst Keith Morris said that from a
share price point of view "we are there, or thereabouts" and
that Halliburton, as a trade buyer, should be able to pay more
than private equity which cannot extract any synergies.
NEW TECHNOLOGY APPEAL
Export's key attraction is its proprietary technology for
oil-well maintenance, which is still in testing and whose value
depends on bidders taking a gamble on its future, analysts say.
Export's system could dramatically cut the costs of fixing
oil wells because it allows this to be done from a supply ship,
rather than from rigs that are expensive to hire and take a
long time to move to site.
Halliburton, through its leading role in offering oilfield
services to a global client base of oil companies, is in a
stronger position than most to exploit the benefits of Export's
Halliburton had faced a de facto deadline of June 2, when
Expro is due to hold a shareholder meeting to vote on the
Candover deal, the latest in a series in the sector.
Last September General Electric (GE.N) agreed to buy UK oil
services company Sounded, while in December U.S. private equity
firm First Reserve agreed to buy Abbot Group.
(Additional reporting by Mike Elliott; Editing by Richard
Hubbard, Greg Malice)
Christopher Dodd signaled that the Senate is on track to confirm
three nominees to the U.S. Securities and Exchange Commission.
``I want to get people in place and start making decisions.
Too much is at stake with this housing mortgage crisis, the
economic crisis,'' Dodd said in an interview on Bloomberg
Television's ``Political Capital with Al Hunt,'' scheduled to air
today. ``The SEC needs to function. We've got some huge issues
Dodd said he has heard from former SEC Chairman Arthur
Levitt, who has urged Congress to wait until after January when a
new president takes office to seat new commissioners. Dodd said
he is inclined to confirm all three nominees.
``A couple of them are very good appointees,'' said Dodd, a
Connecticut Democrat. ``You can't just get your side through,
given the margins in the Senate.''
President George W. Bush has nominated Elisse Walter, a
senior executive vice president at the Washington-based Financial
Industry Regulatory Authority, and Luis Aguilar, a securities
lawyer at McKenna Long & Aldridge LLP in Atlanta, to fill the
vacant Democratic slots. Bush picked Troy Paredes, a law
professor at Washington University in St. Louis, to fill a
Dodd, 63, deflected criticism of his legislation to stem
mortgage foreclosures by creating a Federal Housing
Administration program to insure as much as $300 billion in
mortgages for troubled borrowers after lenders agree to forgive
part of the loan principal. The measure would be financed in part
using money originally set aside for affordable housing.
House Financial Services Committee Chairman Barney Frank, a
Massachusetts Democrat, opposes diverting money from the
affordable housing fund, which he wants to be used to help
victims of Hurricane Katrina.
``We have done a lot already in Katrina and we obviously
probably do need some more. But the foreclosure crisis is
national in scope,'' Dodd said. ``This problem is now spreading,
and so while I'm very sympathetic to the Katrina issues, we've
got a problem here.''
The affordable-housing fund, which the Senate Banking
Committee approved on a 19-2 vote May 20 as part of a larger
housing bill, would be financed by Fannie Mae and Freddie Mac,
the government-sponsored enterprises that are the nation's
largest providers of home-loan funding. The alternative, Dodd
said, would be to put the cost on taxpayers.
``We've got to address this,'' Dodd said. ``And if I can
address it by having the potential loss come out of GSEs, that is
my first priority.''
Levitt is a board member of Bloomberg LP, the parent of
To contact the reporter on this story:
Lorraine Woellert in Washington at