Well, that didn’t take long.
SABMiller has rejected an improved takeover offer from bigger rival Anheuser-Busch InBev, throwing into doubt its bid to create a super brewery.
A “Bud-Miller” combination would be the world’s largest beermaker by far, with nine of the world’s top 20 beers by volume, and annual sales of $55 billion.
Earlier Wednesday, AB InBev said it was prepared to buy SABMiller for £42.15 ($64.34) per share in cash. That valued SABMiller at £68.2 billion ($104 billion), or 44% higher than its share price before talk of a takeover began circulating in September.
AB InBev has already had two initial proposals at £40 ($61.07) and £38 ($58) per share rejected by SABMiller.
“The board … rejected the £42.15 proposal as it still very substantially undervalues SABMiller, its unique and unmatched footprint, and its standalone prospects,” SAB Miller said in a statement.
Shares of both firms shot up last month when SABMiller, owner of the Miller Lite, Pilsner Urquell and Peroni brands, announced that AB InBev was interested in making a bid.
If the deal happens, it would be the biggest merger in brewing history, and could rank among the top 10 takeovers of all time, according to Dealogic and EY.
SABMiller’s chairman had already struck a cautious note earlier Wednesday.
“AB InBev needs SABMiller but has made opportunistic and highly conditional proposals, elements of which have been deliberately designed to be unattractive to many of our shareholders,” Jan du Plessis said in a statement. “SABMiller is the crown jewel of the global brewing industry.”
As younger drinkers turn in ever greater numbers to independent breweries, the global market leaders have been trying to defend their market share.
AB InBev has swallowed Seattle’s Elysian Brewing, Oregon’s 10 Barrel Brewing and Chicago-based Goose Island in the last year or two.
SABMiller has also tapped into the craft beer scene, buying one of the UK’s most successful independents, London’s Meantime Brewing Company, in May.
SABMiller shares were up 1% after the bid was rejected. They had opened up 3%. AB InBev shares were up 2%, after opening 4% higher.