AB InBev and SABMiller announced today that they have agreed ‘in principle’ to merge as one company.

AB InBev agreed to pay SABMiller’s shareholders £44 per share in cash, with a partial share alternative for around 41 percent of SABMiller’s shares.

A statement from both companies issued this morning, said: “The Board of SABMiller has indicated to AB InBev that it would be prepared unanimously to recommend the all-cash offer of £44 per SABMiller share to SABMiller’s shareholders subject to their fiduciary duties and satisfactory resolution of the other terms and conditions of the possible offer.”

The new offer is higher than yesterday’s £43.50 per share and follows last weeks rejected offers of £38, £40 and £42.15 per share.

The offer of £44 per share is approximately 50 percent higher than SABMiller’s Sept 14th closing share price, just before the initial bid was made.

The UK takeover deadline has been extended to give both parties adequate time to formalise an agreement. The deadline which would have been on Wednesday, 14 October has been extended to 5pm on 28 October. By this time, AB InBev needs to make a firm offer, or state it does not intend to make an offer.

The new bid would see AB InBev pay SABMiller £68bn / $104bn. The merged company will control 30 percent of global beer volumes and generate revenues of $64bn and (earnings before interest, taxes, depreciation, and amortization) EBITDA of $24bn.

The next hurdle would be to overcome regulatory issues in certain countries. AB InBev says it will put forward a ‘best efforts’ commitment to get the clearances required to close the transaction.

AB InBev has also agreed to pay SABMiller $3bn if it fails to get regulatory approval or clearances from its shareholders, and the transaction fails to close as a result.