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07.07.2008 10:02 am

Two InBev nominees sold shares as price rose

St. Louis Post-Dispatch
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As part of its effort to oust the Anheuser-Busch board, Inbev had to tell the SEC about any transactions in A-B shares by the people it wants to put on the board. It’s interesting reading, and it may provide some insight as to what they think is a fair value for the company.

One nominee,  James E. Healey, sold 300 shares on June 11, just a week before InBev made its $65-a-share offer public. Healey’s sale price is not disclosed, but A-B shares closed at $58.35 that day. The shares started rallying on May 23 based on widespread speculation that an offer was imminent.

Another nominee, Adolphus A. Busch IV, sold 5,000 shares on May 21, 5,000 on May 23 and 15,000 shares on June 20, two days after InBev went public with its offer. Those sales, however, are a small part of Adolphus’ holdings: He still owns 215,608 shares.

Allen Z. Loren, a third nominee, sold 4,000 shares on May 15, just before the takeover talk got going. The closing price that day was $51.81.

Besides Adolphus Busch, just one other InBev nominee owns any A-B stock. That’s Ernest Mario, who holds 7,405 shares through various family entities.

 Healey is a former chief financial officer of Nabisco Group Holdings, Loren is the retired chairman of Dun & Bradstreet and Mario is chairman of Capnia, a development-stage pharmaceutical comopany in Palo Alto, Calif. Adolphus Busch is a local conservationist and real-estate developer and is, of course, the uncle of Chief Executive August Busch IV.

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18 comments

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Obviously the list of people that Inbev wants to put on the board have been “interviewed” to make sure they are sympathetic to the takeover idea. I am sure they will be “partial” in their considerations…LOL!

— Tim
11:20 am July 7th, 2008

It is all about the money, or is it? The share holders, if they sell, will hit a sweet windfall but for those who don’t sell, the stock will fall and they will be stuck with a stock that is no longer in demand. I believe product sales will slip. Many loyal customers will eventually drift away. This may not seem like too big of an impact, but with the competition of other beer mfg’rs InBev is assuming that they will be able to continue AB’s marketplace. I see this as a gross misjudgement of brand loyalty. Mostly the brand loyalty is the local buying power of regional beer drinkers. They may sustain the worldwide customers but they will take a hit locally. Especially if there is a huge shake up and thr St. Louis org. is removed. For all the Warren Buffett’s it is all about profit and not pride. For them it doesn’t matter if they sell out as tradition for their own gratification regardless of what a merger like this will affect. But that is business and we have the best system set up for this kind of transaction. On another note, this just adds up to further monopolization in the beer industry. We need a Teddy Roosevelt to come back and break up monopolies that are reforming in the business world.

— dan
12:41 pm July 7th, 2008

One interesting thought: Years ago my dad told me how AB was getting worried about possible monopoly regulators breaking up the company because they were over 50% of the market share (50.5% or so). The word was AB was going to try to sustain their market share without getting too much bigger until they got a feel for what the government regulators were going to do. This was back during the last year of Reagen if I remember correctly. It would be interesting if an Inbev takeover would suddenly spur the anti-trust folks to revisit them…

— Tim
1:13 pm July 7th, 2008

Anheuse-Bush shares it’s wealth with the communities where it does business and always establishes business behaviors that are above the prevailing ethical and moral standards. AB has donateded over 370 millon dollars in the last ten years to nonprofit organizations working to enhance the lives of millons of people. For the fifth consecutive year AB ranked as the No.1 company in the bevearge industry on FORTUNE magazine’s list of ” America’s Most Admired Companys” and “Worlds Most Admired Companys”. AB has always been a big supporter of our troops. It’s ironic that the market should punish this behavior, where it really should be emulated (especially on Wall Street). AB’s business behavior is what you would expect from a company that plans on a very long profitable future. I ask that you make your voices herd in support of this great American Company. Someone has to have the courage to stand up and say that enough is enough and stop the selling of America to foreign countrys. For heavens sake cant we keep somthing American owned and made in this country

— JP
3:07 pm July 7th, 2008

The A-B board needs to stop trading press releases and enter into discussions with a deep pocketed, willing buyer. The board is on the precipice of breaching its fiduciary duties. InBev wants to talk friendly, but cant because A-B is too proud. Message to the Buschs and the board: it is not your company. InBev’s proxy solicitor is no doubt busy working the phones, based on what they are getting paid per the filing today, and the majority of shareholders will take certainty now; not some pie-eyed promises to deliver value a year from now. If the board is smart, they will sit down and negotiate a higher price. If they aren’t smart they wont be directors.

— Jack Bauer
3:08 pm July 7th, 2008

One thing that may don’t appear to understand about the proposed deal is it will not create any future value for BUD shareholders. If the deal goes through, BUD shareholders will be forced to surrender their shares to Imbev for a one time cash buy out and will have to pay capital gains taxes for selling their shares. No current BUD stock holder will have any interest or stock in the combined company. You just get a check and BUD stock will no longer exist. So this deal is really a transfer of Bud’s value to Imbev shareholders taking advantage of the weak dollar. I agree with Dan that Imbev is grossly under estimating the affect of a hostile takeover on loyal Bud drinkers. Imbev will ultimately loose Bud’s market share and ruin a great company.

— Chas
12:43 pm July 8th, 2008

If you take the emotion out, jack bauer is right on the money. too many posters seem to think that the shareholders of A-B should be all warm and fuzzy feeling about St.Louis and the charities, blah,blah,blah. You don’t invest your money in the stock market for the warm and fuzzies. You invest to hopefully make money. Compared to what A-B stock has done the past few years, I’ll take my $65.00 and pay the capital gains tax. Better to pay it now, because the rates will surely go up when the Dem’s get their way. This deal will hinge on the stockholders(owners) deciding whether it is a good deal or not. I’m betting they will beat the door down to sell.

— whirled peas
1:42 pm July 8th, 2008

In refernce to Adolphus Busch IV on Inbev hand selected board…I am so glad I don’t belong to a family that sells each other out!!! I honestly don’t know how they (Busch’s) sleep at night. (I am aware of both sides of the story)
When you read these types of family cut throats it makes you feel “warm and fuzzy” about not having a lot of money but having the love and support of your family.
God have pity on them!!!!

— kdunlap
1:55 pm July 8th, 2008

So the point of this story is what? That Brito had already talked to these folks months ago?? Tree hugger Adolphus was already bellied up to the bar selling himself and his name AND some of his stock?

So these people knew some inside info and sold some stock? Again unless it is considered insider trading (is it??) , why are articles like these being printed? So many silly little articles with little info. All Joseph Pulitzers must be rolling in their graves.

— Lisa
5:48 pm July 8th, 2008

Chas–I don’t understand your point. Anyone can take their $65/share they receive and go buy InBev’s stock. It’s not like they are taking away the current shareholders’ right to buy InBev and reacquire any future dividends and capital gains earned by A-B as a part of the newly merged firm.

There is no transfer of value from A-B shareholders to InBev shareholders in the manner you are describing. If anything, there is an initial transfer of value from InBev’s owners to A-B’s shareholders to finance the $65/share price.

— Paul
9:42 pm July 8th, 2008

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