Anheuser-Busch (BUD) confirmed they received an unsolicited bid for all outstanding shares from Belgium brewer InBev for $65/share. As of 5:45 pm EST, BUD’s shares have surged over $4 (over 7.5%) in after-hours trading to just under $63.
Considering the preponderance of evidence leading up to this confirmation that the InBev bid was real, this large of an upward movement seems strange. Is the takeover likely? Yes. Is it any more likely than it was yesterday? Only slightly. The offer is 24% more than BUD’s stock price on May 22nd, the day before reports said InBev was preparing a takeover bid and only 2% below the offer price.
So what are investors thinking? They’re thinking BUD will hold out for more. Since when is a first offer a best offer? Even in the case of Microsoft-Yahoo, in which Microsoft eventually stormed off in frustration, the original offer was raised. BUD investors and arbs are clearly betting that InBev will be raising its offer, too.
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