SABMiller chief executive Alan Clark and most of the executive team will leave the business when the proposed merger with AB InBev is completed.
|||Johannesburg - SABMiller chief executive Alan Clark and most of the executive team will leave the London-based business when the proposed merger with Anheuser Busch (AB) InBev is completed.
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Since the SABMiller board gave the deal its backing last week, AB InBev has been moving with significant speed in its preparations for the merger.
On Tuesday, the brewer published the terms of the transaction, and yesterday, AB InBev announced the organisational structure and leadership of the combined entity.
Conspicuous by their absence in the new structure were members of the SABMiller executive, including Clark. From the SABMiller executive, only Mauricio Leyva, who is currently SAB managing director, has been retained in the proposed structure. Leyva is set to become a zone president for the Middle Americas.
Payout
“For Clark and the rest of the executive committee leadership team they will leave the business when the deal completes,” SABMiller spokesman George Hudson said.
Hudson said the South African-born Clark had been expatriate for the last 15 years and spent much of his time travelling.
“After the deal completes, he is going to take some time out and reconnect with his friends and family before deciding what to do next.”
Clark is 56 years old.
AB InBev’s Rio de Janeiro, Brazil-born chief executive Carlos Brito, will be at the helm of the merged entity.
Responding to a question on the extent to which Clark’s payout would increase after AB InBev revised its cash offer from the previous £44 (R821) a share to £45 a share, Hudson said it was not possible to determine the exact payout, “because that will depend on the timing of any change of control, and performance – for bonus and total shareholder return-determined long-term incentive awards – through to that period”.
AB InBev said this week that it expected to complete the deal on October 10.
“However, based on the £1 increase, (Clark’s) package will potentially increase from £55.3m to £57.1m – this is simply an indication of the likely amount due to (Clark), based on actual performance to date and expected performance of the comparator peer group companies through to change of control. Note that more than half of this amount relates to the value of shares already owned outright, plus the inherent gain in share options, which have already vested but have not yet been exercised,” Hudson said.
Clark joined SAB in 1990 as a training and development manager and became chief executive in April 2013.
In its terms of the transaction, published on Tuesday, AB InBev said, given the complementary geographical footprints and brands of AB InBev and SABMiller, the merged entity would have operations in virtually every major beer market in the world, including key emerging regions with strong growth prospects such as Africa, Asia, and Central and South America.
AB InBev said with a presence in the southern and northern hemisphere, the combined company would benefit from the natural hedge against local or regional market, economic and seasonal volatility.
Headquarters
In the proposed structure, AB InBev also announced that the combined group would have its headquarters in Leuven in Belgium and its global functional management office in New York. The move will see SABMiller’s employees in the UK lose their jobs.
“Following the completion of the combination, it is intended that a presence will be retained in SABMiller’s UK offices in Woking for people working and business continuity for the transitional period, allowing the combined group to fully capture synergies and best practices while continuing to grow the business,” AB InBev said yesterday.
“Job losses are always on the cards when a merger deal is announced. Annual cost savings of $500 million (R7 billion) or so are expected, so there was always a question mark over the UK presence,” Neil Wilson of ETX Capital said yesterday.
Wilson said the UK’s vote to exit the EU could have been the deciding factor.
AB InBev said SABMiller general counsel and corporate affairs officer, John Davidson, group human resources director, Johann Nel, and Africa managing director, Mark Bowman, would remain with the merged entity for at least six months following the merger.
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