BF.B Stock Reverses Course Into Green On Report Of $15B Buyout Offer

• BF.B had opened lower on Wednesday morning but edged into green territory following the report. 
• Last week, TD Cowen had predicted a buyout price of $33-$34 per share for Brown Forman.
• In March, Brown-Forman confirmed talks with French spirits-maker Pernod but noted that the parties have not yet agreed on the terms of a deal.

Shares of Brown-Forman (BF.B, BF.A) leapt into green territory on Wednesday, gaining over 1%, following reports that Sazerac has offered to buy the company for around $15 billion.

According to a report from The Wall Street Journal, citing people familiar with the matter, Sazerac offered Brown-Forman $32 a share. This represents a premium of about 9.6% from BF.B’s closing price on Tuesday.

BF.B had opened lower on Wednesday morning after closing at $29.21 on Tuesday but edged into green territory following the report.

Last week, TD Cowen had predicted a buyout price of $33-$34 per share for Brown Forman.

Sazerac is a family-owned American distiller known for producing a wide range of spirits. Its brands include Buffalo Trace bourbon, and Fireball Cinnamon Whisky. Like Brown-Forman, it is also headquartered in Louisville.

Other Interested Players

Last month, the paper also reported that the Jack Daniel’s maker is discussing a mostly-stock deal with French spirits-maker Pernod Ricard. Brown-Forman confirmed the talks with Pernod and said that the deal would be akin to a “merger of equals,” while also adding that the parties have not yet agreed on the terms.  

In March, Brown-Forman President and CEO Lawson Whiting said that the company was navigating a “challenging operating environment” and expects low visibility for the year amid macroeconomic and geopolitical volatility, coupled with headwinds from consumer uncertainty.

Brown-Forman also said it expects full-year organic sales and operating income to decline in the low single digits, maintaining prior guidance.

How Did Retail Traders React?

On Stocktwits, retail sentiment around BF.B stock stayed within the ‘neutral’ territory over the past 24 hours, while message volume remained at ‘high’ levels.

BF.B stock has fallen nearly 12% over the past 12 months.

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