Less than a month ago we were being asked to believe, according to market rumour, that 3G, the notoriously frugal Brazilian investor, was planning on bidding for SABMiller. Now the market rumour, having been sparked by an entry on a little-known Brazilian blog, is that 3G is limbering up to practise its cheese-paring expertise on Diageo, the second of the three global drinks groups.
I suggested at the time that the only reason to hold SABMiller’s shares was if you believed a bid would emerge, otherwise avoid. They are now two quid lower. I feel much the same about Diageo. The shares sell on such a high multiple, at a time when the company is hitting headwinds in some of its most important markets,