updated 11/19/2007 9:16:29 AM ET 2007-11-19T14:16:29

SABMiller, the world's third-largest brewer, said Monday will bid $1.2 billion for Grolsch, the Dutch beer with a distinctive swivel cap.

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Grolsch is the second-largest Dutch brewer after Heineken, with approximately 15 percent market share in the Netherlands.

In a joint statement, the companies said Grolsch would back the 48.25 euros per share offer, which they said offered a premium of more than 80 percent to Grolsch's average share price over the past month.

Grolsch NV shares leapt 76 percent to 47.40 euros in early trading in Amsterdam Monday.

Shares in SABMiller PLC fell 0.9 percent to 13.32 pounds in London.

SAB said it believed it would be able to grow Grolsch's brand more quickly than the company could independently. It sees growth "potential for the Grolsch brand across Africa and Latin America, where the premium segment is still in its infancy, and in the more developed markets of Central and Eastern Europe."

In a video statement, SABMiller's marketing director Nick Fell said "for anybody looking to grow their premium brand business, this is an absolute peach of a brand to get hold of."

A formal offer will be launched in January and is subject to regulatory approvals and a 75 percent acceptance by Grolsch shareholders, the companies said. However, Grolsch shareholders representing 37 percent of shares have agreed in advance to tender their shares to the offer.

Both companies report earnings twice a year. For the six months through June 30, Enschede-based Grolsch's earnings were 7.6 million euros on sales of 164 million euros.

London-based SABMiller had net profit of $958 million, on sales of $10.78 billion in the same period.

SABMiller makes Miller beers, Pilsner Urquell and Peroni, among others.

Grolsch is known almost entirely for its Grolsch lager, which accounts for 90 percent of sales worldwide, though it has introduced a range of seasonal beers and a white beer in the Netherlands. It has sales in Britain, the U.S., Canada, France, Australia and New Zealand.

Copyright 2007 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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