Budweiser brewer Anheuser-Busch InBev has cleared another major hurdle in its pursuit of SABMiller after winning regulatory backing in China.
The takeover approach was given the green light by China’s Ministry of Commerce after the Belgian brewer agreed to sell SABMiller’s 49% stake in China Resources Snow Breweries to China Resources Beer.
It means the firm’s £79bn swoop has now been approved in 23 jurisdictions worldwide, satisfying all pre-conditions of the deal.
The company said it is still aiming to complete the mega-merger to create the world’s biggest drinks firm by the end of this year.
However, the tie-up hangs on a knife edge as SABMiller’s investors mull over an increased offer made on Tuesday triggered by the collapse in the value of the pound after the Brexit vote.
Shareholders in SABMiller will now receive £45 a share, up from its earlier offer of £44, valuing SABMiller at about £79bn.
The pound has plunged in value versus the US dollar since the
June 23 vote, falling more than 10% to $1.31.
Concerns about the deal have been raised by investors, such as Elliott Management, Davidson Kempner Capital Management and Aberdeen Asset Management.
However, other shareholders, including New York-based investment management firm Twin Capital Management, want the takeover to go through.
The announcement comes as AB InBev reported a 4.3% rise in operating profits for the second quarter to $4.01bn following strong sales of Budweiser, Corona and Stella Artois.
It said the three brands saw revenue growth of 8.4% over the period, with Corona alone notching up a 13% rise compared to the second quarter of last year.
AB InBev, the world’s largest brewer, has already moved to sell SABMiller’s Peroni, Grolsch and Meantime brands to Japanese firm Asahi. It has also signalled its intent to sell SABMiller’s businesses in central and eastern Europe.
SAB employs around 69,000 people in more than 80 countries and has global annual sales of more than $26bn.