InBev buys Bud for $52 bln to be top world brewer

By Philip Blenkinsop and Martinne Geller

BRUSSELS/NEW YORK (Reuters) - Anheuser-Busch Cos Inc BUD.N accepted a sweetened $52 billion takeover bid from Belgium-based InBev NV NV INTB.BR, creating the world's largest beer maker and placing an iconic U.S. company into foreign hands.

Ending a month-long standoff, InBev, which makes Stella Artois and Beck's, agreed to pay $70 per share in cash for the maker of Budweiser, up from its original unsolicited bid of $65 per share, both companies said on Monday. The improved offer marked a 27 percent premium to Anheuser's record-high stock price in October 2002.

The deal, which InBev and analysts expect to gain regulatory approval, would be the largest cash transaction in history, according to research firm Dealogic and the second- biggest ever foreign takeover of a U.S. company after Vodafone Group Plc's (VOD.L) $60.3 billion acquisition of AirTouch Communications in 1999, according to Thomson Reuters data.

The combined Anheuser-Busch InBev would have about $36.4 billion in annual net sales, with 40 percent coming from the United States, and would brew about a quarter of the world's beer.

InBev Chief Executive Carlos Brito will be CEO of the new company, while Anheuser will get two seats on its board. One will go to Anheuser CEO August Busch IV, who will have no executive or managerial responsibilities, while the other has yet to be named.

Brito told a conference call the beauty of the deal lay in acquiring Anheuser's near 50 percent share of the U.S. market and in taking its Budweiser brand global.

"It's all about complementarity and not overlap," he said.

Anheuser's home town of St. Louis, Missouri will be the headquarters for the North American region. The companies said all 12 of Anheuser's U.S. breweries would remain open.

FRIENDLY END TO MONTH-LONG BATTLE

The deal brings an amicable resolution to a month-long saga that was becoming increasingly hostile as the companies traded lawsuits and InBev set the stage to replace Anheuser's board.

"While the process was at times difficult for all parties, in the end the right result occurred for everyone," Busch told reporters on a conference call.

Anheuser shares were up 0.8 percent at $67.04 in midday trading in New York, having surged 8.6 percent on Friday as news of a higher offer and talks emerged. InBev was off 3.4 percent at 43 euros, following a 7.4 percent rise on Friday and as a potential rights issue weighed on the stock.

"The synergies are better than expected, $70 is a reasonable price and InBev has avoided a long drawn-out battle in the courts," said KBC Securities analyst Wim Hoste in Brussels.

The companies said the combination would yield cost synergies of at least $1.5 billion annually by 2011, to be phased in equally over three years.

InBev will finance its purchase with $45 billion in debt, including $7 billion bridge financing for divestitures. It will also issue $9.8 billion of new shares.