Pressure rises as F&N nears high noon for Heineken bid

Heineken's S$53 offer is waiting for shareholders' go signal, but ThaiBev could still say no.

According to CIMB, the F&N board has irrevocably accepted Heineken’s improved offer of S$53 for F&N’s entire stake in APB. The board has also agreed to terms of exclusivity with Heineken which prevent it from talks or negotiations on an alternative offer. A break fee of S$56m will be paid to Heineken if the transaction is not completed within 120 days from 18 Aug 2012 as a result of F&N shareholders voting against the deal at the EGM, among others.

Here's more from CIMB:

It comes down to Thai Bev and Kirin. The decision to sell APB will now come down to a shareholders’ vote (EGM date yet to be disclosed). The undertaking to pay Heineken a break fee if shareholders reject the sale gives us a sense that the board is confident of a positive outcome. Kirin’s vote will be key. We see little reason for it to say no to the improved offer if its true interest in F&N lies in the non-beer F&B business. We believe that other minority shareholders are also likely to agree.

Thai Bev which has a 26.4% stake in F&N could still vote against the sale. But short of 1) making an MGO for F&N, or 2) KPGL making a higher offer for F&N’s entire stake in APB, we believe that Heineken is poised to take majority control of APB.

F&N stands to make a S$4.77bn gain on disposal from this deal. It is considering options for the distribution of part of the proceeds Potential special dividends, reinvestment upside and more corporate actions on FNH are the expected stock catalysts.