Anheuser-Busch InBev, the world's largest brewer, is set to make a takeover bid for its biggest rival SABMiller. Combining the two would create a company with a market capitalization of about $276 billion, and annual sales of $55 billion.  

SABMiller said in a statement AB InBev had given notice that it intends to make an offer for the company, "No proposal has yet been received and the board of SABMiller has no further details about the terms of any such proposal," said SABMiller, which makes lagers such as Pilsner Urquell and Peroni.

Anheuser-Busch InBev is the owner of Budweiser and Bud Light, and has been reported to be interested in making the bid for a while. Sales of Bud and Bud Light have been waning for years, putting the brewer in a tough spot.

SABMiller shares surged by about 18% in London. Shares in AB InBev are also up about 8%.

SABMiller's statement:

“The Board of SABMiller notes the recent press speculation and confirms that Anheuser-Busch InBev SA/NV ("ABInBev") has informed SABMiller that it intends to make a proposal to acquire SABMiller. No proposal has yet been received and the Board of SABMiller has no further details about the terms of any such proposal.

The Board of SABMiller will review and respond as appropriate to any proposal which might be made.

There can be no certainty that an offer will be made or as to the terms on which any offer might be made.

In the interim, shareholders are strongly advised to retain their shares and to take no action.”.