Iconic American brewer Anheuser-Busch rejected a $46.35 billion offer to be acquired by Belgian-Brazilian brewer InBev, calling the deal “financially inadequate.”

The move was expected but was the company's first response to the buyout offer and could bring the drama between the two brewing giants to another, less-friendly stage: a hostile takeover attempt by InBev.

Anheuser (BUD) turned down the $65-per-share offer late on Thursday, saying shareholders would receive greater value with current plans to grow the company.

“As you say yourself, you dream big. We respect your desires to grow your company. But your growth should not come at the expense of our stockholders,” August A. Busch IV, president and CEO of Anheuser, said in a letter to InBev CEO Carlos Brito.

Earlier on Thursday InBev released a statement saying it filed suit in Delaware Chancery Court, seeking a declaratory ruling on Anheuser shareholders’ ability to remove all 13 members of the company’s board, including the five who were elected in 2006.

InBev could seek to oust all 13 members of Anheuser’s board if it decides to take the deal hostile and make its case directly to Anheuser shareholders.

In the mean time, Anheuser made its pitch to shareholders that they are better off allowing the company to remain independent. 

"The InBev proposal fails to be competitive with alternative plans the company has developed in recent months to generate significant top-line and bottom-line growth, which will increase value for the company's shareholders," said Douglas A. Warner III, the board's lead independent director. "The board will continue to consider all opportunities that build shareholder value."

Anheuser argued that the $65-per-share offer undervalues the company's key assets and its prospects, specifically its iconic brands, market leader position, international partnerships and "accelerated earnings growth." The company detailed an enhanced productivity plan that aims to save more than $750 million through 2009 and $1 billion through 2010. 

Busch IV also challenged InBev's argument that the potential merger would create ample synergies, which he said are instead "profit enhancements." 

"We believe that we can deliver similar enhancements to our shareholders independent of a transaction, and have included these enhancements in our accelerated earnings growth plan," Busch IV wrote in his letter.