Anheuser-Busch InBev raised its takeover offer for SABMiller on Monday, as the world's largest brewer tries to win over its smaller rival to the idea of creating a giant that would make nearly a third of the world's beer.
The maker of Budweiser and Stella Artois is offering 43.50 pounds per share in cash to most SABMiller shareholders, with an option available for some to take a lower-priced mix of cash and shares.
AB InBev has until 1600 GMT on Wednesday to launch a formal bid for SABMiller, in what would be the biggest UK company takeover ever.
Monday's sweetened offer is the company's fourth, following rejections of cash offers at 38, 40 and 42.15 pounds per share.
Three of SAB's top 10 shareholders had spoken out in support of the board rejecting the previous offer, which SABMiller said "very substantially" undervalued the company.
SAB declined to comment on the new offer.
The cash-and-share alternative is meant to be unattractive for institutional shareholders. It was designed "for and with" SABMiller's two big shareholders, Altria Group and the Santo Domingo family of Colombia, which together own about 41 percent of the stock.
The proposal is conditional on Altria and the family electing the share alternative for all their shares.
Altria had already endorsed AB InBev's last offer, while the Santo Domingos rejected it. Neither party was immediately available to comment on Monday's offer.
Taking into account the discounted price of the share alternative, the new offer would see AB InBev pay 67 billion pounds ($103 billion) for the maker of Peroni, Grolsch and Pilsner Urquell. The previous offer would have seen the company pay 65 billion pounds ($100 billion).
South Africa's Public Investment Corporation (PIC), Poland's Kulczyk Holding and Scotland's Aberdeen Asset Investments -- respectively SABMiller's fourth, fifth and seventh-largest shareholders -- had all publicly sided with SABMiller. Altogether their holdings account for 8.2 percent of the company.
It remains to be seen whether the new bid will be embraced by the Santo Domingos, which own 14 percent of the company following the sale of their Grupo Bavaria business to SABMiller in 2005.
"It might get them to talk," said Exane BNP Paribas analyst Eamonn Ferry.
Their two board representatives who voted against last week's offer are Alejandro Santo Domingo and Carlos Alejandro Perez Davila, cousins who also run New York-based Quadrant Capital Advisors.
Yet Alejandro Santo Domingo, the Harvard-educated fixture of New York high society, is according to media reports well-acquainted with AB InBev's controlling shareholders, including Brazilian billionaire Jorge Paulo Lemann.
"We think the Colombians are very close to Lemann and that Lemann knows exactly what price the Colombians want," said an SAB shareholder with a less than 1 percent stake. "I can't understand their tactics though."
AB InBev Chief Executive Carlos Brito said last week that his company's large shareholders had approached Altria and the Santo Domingos and understood them to be "at least receptive to an approach".
Santo Domingo told the Financial Times last week that "at the moment we have no comment".
The smaller SAB shareholder, who was not authorized to speak to the press, said he could see merits in a merger and hoped discussions would continue, to find a price that was acceptable to Santo Domingo.
"It makes so much sense to put these two businesses together, but they clearly have to negotiate and get the best price," the shareholder said. And at the moment, they need to get the Colombians on board."