Anheuser-Busch $46 Billion Belgian Buyout Bid
InBev, a Belgian firm, has offered to buy Anheuser-Busch for $46 billion.
Anheuser-Busch Cos., the nation’s biggest brewery, received a $46 billion buyout offer Wednesday from a Belgian brewer that might be too good to refuse.
The maker of Budweiser beer disclosed late Wednesday that InBev SA, whose brands include Beck’s and Stella Artois, delivered an unsolicited all-cash bid of $65 a share. It’s unclear whether senior Anheuser-Busch executives think the deal makes sense, but shareholders may be drawn to the offer that represents a sizable premium over the company’s closing price of $58.35 Wednesday.
It’s astounding that company from the country that arguably makes the finest beers available on the planet is interested in buying the brewer of Budweiser at a premium. But business is business. Except when it isn’t:
Opposition to a potential takeover has already been fierce in Anheuser-Busch’s hometown of St. Louis, and elsewhere in the U.S. The brewer employs 6,000 people in St. Louis, and many workers are worried InBev will cut jobs as the companies consolidate.
Web sites have sprung up opposing the deal on patriotic grounds, arguing that such an iconic U.S. firm shouldn’t be handed over to foreign ownership. Republican Gov. Matt Blunt said Wednesday he opposes the deal, and directed the Missouri Department of Economic Development to see if there was a way to stop it. “I am strongly opposed to the sale of Anheuser-Busch, and today’s offer to purchase the company is deeply troubling to me,” Blunt said in a statement.
“Like baseball, apple pie and ice cold beer (wrapped in a red, white and blue label), Anheuser-Busch is an American original,” the site says.
Interestingly, Anheuser-Busch is the U.S. distributor for many of the InBev brands, including Beck’s and Stella. Indeed, I didn’t even realize they distributed Widmer Hefeweizen and Leffe Blonde, two of my favorites.
As a resident of St. Louis with more than a couple of friends who work for A-B, let me say that the local attitude is that they can piss off. No one here thinks this is a good idea.
McDonnell-Douglas got bought by Boeing. TWA got bought by American Airlines and then St. Louis got dehubbed by AA. Ralston-Purina got bought by by Nestle. The Rams may well be leaving for, can you believe it, LA. On top of the hopeless St. Louis city government and schools, this is just one more blow the Gateway to the West doesn’t need.
Bud distributes Bass???
As someone who drinks Bass when he drinks beer, I feel so … dirty.
Heh. They’ve got a lot of trucks, I guess. And those really big horses. But, yeah, I drink Bass and Bodington’s quite frequently and never realized there was an A-B connection.
Save, perhaps, for those being offered a 15 percent premium on their stock shares. But, yeah, I can’t imagine this would be good for StL.
Considering that StL lost the Cardinals — granted, not that big a loss — during my memory, you’d think they’d learn. The Rams won a Super Bowl, went to another, and have had several decent runs in the very recent past. A state-of-the-art stadium is, like it or not, part of the cost of doing business.
Say, charles austin, where did you go to high school?
Well, obviously, the sale made sense to the Busch family, a significant number of whom live completely off their stock in the company.
InBev has a substantial presence in Latin America and I wonder if they’re not the distributors for Busch there. The relationship between the two companies may go back a ways.
Globalization is great except when foreigners want to do it to us.
Lots of details here since I know a bit about the industry. I’d equally argue that InBev is a Brazilian company due to a merger of a couple of years ago. InBev = Interbrew (BE) + AmBev (BZ). The CEO is from Brazil.
As for the AB empire you have to separate out the distribution from the production in the USA, under the Three-tier system and the Volstead Act (FYI, beer in NOT an intoxicating beverage under that law, which is why beer was available ~1 year before Prohibition was repealed). The law in the US is that the producers can’t sell directly to the ultimate seller AKA Three-tier system.
So brewer-sells to a distributor, who sells to the retail location (who then sells to you). The brewer (or distiller or winemaker) is prohibited from selling (interstate) directly to a retailer, a middleman is required by law.
Back in the mid-90s AB bought about 50% of several microbrews and foreign brews in order to bring them under the AB umbrella and allow their distributors to have microbrews (except in areas where existing distribution contracts existed):
Grupo Modelo (Corona, Negra Modelo, Pacifico)
Beers you don’t think are Bud, but are:
O’Douls (real decent job on the dark)
Tequiza (cough, beer?)
Meanwhile, Miller is owned by SABMiller. South African Brewery/Miller. Coors is Molson/Coors.
Me, I drink locally.
Bodington’s is available in the US? I’ve never seen it outside Great Britain, and is one of the few beers/ales that I can stand to drink.
I’ll have to see if I can find it in the DC area.
I’ve found Bodington’s quite a bit here, albeit in cans (you have to actually shake it because there’s a ball in there) all over Northern Virginia. Certainly, TotalWine has it. I think World Market, too.
Thanks, James. I would probably have checked TotalWine eventually, but thanks for short-circuiting my search.
James, there is perhaps a differnce in attitude between those who own A-B and those who work for A-B on this matter.
A brand new stadium (originally called the TWA Dome, currently called the Edward Jones Dome) was built for the Rams to lure them here about 15 years ago. Hopefully, that isn’t the new elapsed time standard for billion dollar tax transfers to wealthy sports team owners. Busch stadium lasted all of 40 years before it was torn down.
Dave, I moved here 10 years ago, so the high school question doesn’t work for me, but I do know exactly what you mean.
DC Loser, as a free market advocate, I wouldn’t oppose the sale. St. Louis’ business decline predates globalization. When the World’s Fair was held here in 1904, St. Louis was the fourth largest city in the country. What went wrong is a long, sordid, and controversial tale. This is just the latest blow.
Boyd, I’ve always been able to find Boddington’s in a can with a widget wherever I’ve been, but it was best on tap in Surrey. And I got to see Jack Dee’s widget ads. Classic. Alas, no YouTube link.
I wonder if this isn’t the first in an avalanche of asset sales given the spectacularly weak dollar.
Charles, I happened to visit STL last week on business and stayed at the Hilton next to the stadium. The downtown area has some nice parts, but I was surprised at how close the marginal neighborhoods were to it. It’s obvious from walking and driving in downtown that STL has seen better days.
As a 30 year “brand supporter” of green bottled Rolling Rock, I think it is completely fair play to not oppose an AB sale to “foreigners”. It didn’t stop the “Missourians”.
BTW, I stopped buying RR…tastes like Bud Lite to me now.
charles (or can I call you Charles?), I’ve never looked for it here partly because I’m not much of a beer drinking, preferring stronger stuff, plus it never occurred to me that Boddington’s would be widely imported to the US. It’s been many years since I’ve had any, so I’m not even sure I’d still like it.
The pro sports teams are about all downtown St. Louis has going for it. St. Louis has to be the easiest town in the country to get into and out of the pro sports areans, and all three of them are within a one square mile area. It’s nice now, but I don;t see how it can last.
The population center for the St. Louis SMSA is now west of I270 (the ring road for St. Louis). The decrepit ring around downtown is pretty stunning and is going to make revitalizing St. Louis that much tougher. To be honest, I’m not sure it can be done.
Boyd, of course you may call me Charles. I’m a hunt and peck typer so I just avoid the shift key to save time. I’m more of a single malt man myself, though I do like a good beer from time to time.