UK: Pound weakens again further reducing SABMiller investors takeover premium

The pound fell for a third trading day on October 10, deepening its loss since Friday, October 7’s flash crash and compounding the woes of SABMiller investors, whose takeover premium has all but vanished with the currency’s post-Brexit decline, BDlive reported.

The pound weakened by about 0.3%, trading at $1.24, in early morning trade on Monday, October 10.

Against the rand, the pound was at about R17.12 shortly after 10am on October 10.

At the time Anheuser-Busch InBev announced its offer of £44 per share for SABMiller, the exchange rate was about R22/£, and the deal represented a premium of about 22%.

On October 7 the pound fell about 6% within minutes during Asian trading hours. The steep decline was blamed on trading algorithms, and the currency recouped most of the decline.

Nonetheless, it has weakened markedly since the UK’s June 23 referendum on leaving the European Union, losing about 15% against the euro since then.

11 October, 2016