In late July, 2016, SABMiller’s board recommended, homework help

Business Finance

Read the attached article. Then prepare a written response to these questions: (answer in paragraphs under each question)

1. In late July, 2016, SABMiller’s board recommended that its shareholders accept an offer from AB InBev after AB InBev raised its offer. By how much did AB InBev raise its offer?

2. Why do you think AB InBev made two offers: one for all cash and one for cash and stock? Why wouldn’t all investors simply take the more valuable offer so that the other offer is irrelevant?

3. Also, in late July, AB InBev announced a $1.77 billion loss tied to a currency hedge. Does this loss indicate the hedge was a mistake? Why or why not?

4. The Wall Street Journal reports that SABMiller’s “board voted unanimously in favor of the deal, in part because the company was too far along with the integration and regulatory approvals to reject it.” Are these valid reasons for proceeding with the deal? Why or why not?