Date
29 March 2017
A SABMiller brewery in Budapest. AB InBev made a formal US$107 billion offer to buy SABMiller on Wednesday. Photo: Bloomberg
A SABMiller brewery in Budapest. AB InBev made a formal US$107 billion offer to buy SABMiller on Wednesday. Photo: Bloomberg

AB InBev gets record US$75 bln loan to buy SABMiller

Anheuser-Busch InBev NV said it obtained US$75 billion of loans to back its acquisition of SABMiller Plc, in what is the biggest corporate loan on record.

The senior facilities will be divided into five parts, Reuters reported, citing an investor presentation on AB InBev’s website.

Allen & Overy advised lenders including Banco Santander SA, Bank of America Corp., Bank of Tokyo-Mitsubishi UFJ Ltd., Barclays Plc, BNP Paribas SA and Deutsche Bank AG, according to a statement from the law firm.

“AB InBev’s ability to raise US$75 billion in the loan markets in the space of a few weeks shows that banks are still willing to support top-class borrowers in record amounts, despite the current era of increased regulatory and capital costs,” Nicholas Clark, a partner at A&O in London, said in the statement.

“This is the largest commercial loan in the history of the global loan markets, far surpassing pre-crisis values.”

AB InBev made a formal US$107 billion offer to buy SABMiller on Wednesday, sealing a long-anticipated deal that combines the world’s biggest brewers into a company controlling about half the industry’s profit.

Borrowing to fund the takeover may bring AB InBev’s net debt to 4.5 times earnings before interest, taxes, depreciation and amortization, according to Trevor Stirling of Sanford C. Bernstein.

It was at 2.5 at the end of the second quarter.

There are more than 20 banks in the lending group, according to two people familiar with the matter.

While part of the loan will be replaced by bonds, a sale may not come for about nine months because of regulatory approvals, the people said.

The loans are structured so that interest will increase over time to encourage the company to refinance, according to the people.

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RA/CG

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