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05.23.2008 9:57 am

Is A-B in play? Could the brewer really be taken over?

St. Louis Post-Dispatch
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We’ve got a report online now that says this: “The FT Alphaville blog is reporting that InBev is working on a $46bn takeover for St. Louis-based Anheuser-Busch, the maker of Budweiser. The blog did not disclose its sources, and noted that representatives from InBev and Anheuser-Busch did not comment.”

FT Alphaville is a blog by the Financial Times.

Is this an alarming development? Is Anheuser-Busch in play? Could the country’s largest brewer fall into other hands?

66 comments

Comments are closed.

Of course it’s an alarming development. It’s likely to go down like this….

AB board members balk at initial offer. The secondary offer will include a massive multi-million dollar “bonus” for each of the board members for selling the company and making a profit for the share holders. All the people who work at AB that are struggling to pay the mortgage and put gas in their tanks will get nothing but rah rah speeches about how the two companies together will make a great team. Two years from now, all said employees will be let go. In a nutshell, it’s about the same thing that happened with May Company and A.G. Edwards. The execs for these companies make sure they have their golden parachute, then don’t care one way or another that the house burns down with the employees still inside.

— b
10:20 am May 23rd, 2008

65.00 dollars per share!! I would say that A-B is toast! No one is too big to be bought in todays world!

— dee
10:25 am May 23rd, 2008

You could see this was going to happen. All the other Premium Beverage and Beer companies are buying up each other, and this is going to work its way to a monopoly. I completely agree with b. Eventually there will be a massive fallout from this and thousands of jobs will be lost in St. Louis alone!!! I say the 2 year time frame is a little too soon. I would think with a company the size of A-B, the firings will start from the bottom up and that process could take up to 5 years.

— Corby0712
10:34 am May 23rd, 2008

This is, frankly, terrible news. A-B is the only major brewery left in the US that’s not owned by non-US interests.

Losing A-B’s local ownership would be a huge blow to the entire metro area.

— Brian L
10:40 am May 23rd, 2008

Agree with the initial poster. Signs of the times. Plus, as dee says, no one is exempt from takeovers anymore. Every big executive wants their golden parachute….at all costs.

Good luck to the average A&B worker……they’ll need it in order to not get ****ed.

— agree with b
10:43 am May 23rd, 2008

I hope that if A-B does get bought out that it doesn’t completely pull the rug out from underneath St. Louis’ economy especially now in light of the country’s current economic woes. I know a handful of people who work for A-B, and I don’t want to see them go through lay-offs.

And to “b”… my mom got laid off in that A.G. Edwards buy-out and it devastated our lower middle-class family’s way of life for years. Lets hope something like that doesn’t happen here, though it does seem to be the trend…

— Jen
10:52 am May 23rd, 2008

The comparisons between this deal and other mergers that have negatively impacted our area are inevitable. But I really fail to see how there could be such a large fallout from a company that currently has minimal US presence. Inbev currently uses the AB distribution network, and would now be able to brew their beers at AB facilities in the US as a result of this merger. As for corporate staff here in STL, it isnt like we are being acquired by a company from Charlotte, Chicago, DC, etc. Again, they have only a small US presence (workforce wise) and you dont simply pick up a US company and move their corporate operations overseas. I predict this will have minimal impact on our area. Pride of not being able to say we are the world headquarters is probably it. We are still the US headquarters (just like Milwaukee for Miller) I would bet even the Bud commercials will always continue to say “St.Louis, MO” at the end.

— ND
10:54 am May 23rd, 2008

As the victim of a merger, my advice to the employees and the public is never believe anything management says.

— Joe Steel
11:03 am May 23rd, 2008

Perhaps it will be bought by a progressive european group who will add medical cannabis offerings to the deadly alcohol brews pitched by these drug pushers. Now if we could only get Seagram’s to do the same. These very peoples have caused much suffering by removing hemp from the US economy. Your clothes would last many years if made from hemp.
I laugh at those who vote republican when republican values and practices take companies to foreign ownership each year and make sure the good jobs are outsourced for temporary book cooking. Don’t forget, those who occupied the ill-fated towers sold you out and continue to do so. We have billions in bad paper that have to be paid back. American execs stole from foreigners. How sad we have come to this. Beer is largely unimportant. I feel sad that we still sell our miltitary technology to iffy countries. An enemy today brings the military-industrial complex big bucks tomorrow. Not patriotic at all!

— Slugger
11:17 am May 23rd, 2008

The writings been on the wall folks. SAB-Miller, 60 countries, 6 continents. INBEV, 130 countries, 5 continents- world’s largest brewer. A-B didn’t,couldn’t get big enough fast enough globally. Miller-Coors now in the US very soon sharing brewing, marketing, transportation costs realizing 300 million a year in savings. This is a sign of the new world order. Mega breweries. One can only now speculate how many jobs will remain in STL but it’s a good bet many will be lost.

— dee
11:27 am May 23rd, 2008

For a company that prides itsself and being “American Owned”, it would sure be a shame to see them sold to a foreign company.

— Marc
11:50 am May 23rd, 2008

With the weak dollar, all US companies are subject to this kind of takeover. I hope it doesn’t happen. If it does will they call Budweiser, “The Great Belgian Lager”?

— jfmoyn
11:53 am May 23rd, 2008

Well, it’s good to see that forum trolls are out en masse (SLUGGER). If you want to point fingers, I remember I.T. outsourcing was all the rage back during the Clinton-Era, so don’t go there. Even in the late 70’s, industry jobs were being sent overseas, and the U.S. could not compete internationally because of the high cost of domestic production.
As someone who has seen first hand what a merger does, it is not a fun process, but they can be survived. I’ve been through two buyouts (General American & A.G. Edwards) and the best thing to do is avoid rumors and make yourself indispensable. There are many facets to a buyout, and the stock ownership makes all the difference. The company can still “poison pill” if they felt it was in their best interest. AB still has some fight left in her is the point, so don’t count the fight as being over yet.

— Patriot
12:13 pm May 23rd, 2008

Everything is for sale, 24/7/365. That is a reality.

The management and directors of A-B have a fiduciary responsibility to the shareholders of the company, the majority of whom are neither family nor employers.

If a suitor presents a large offer, it could happen.

One would hope the “base of U S operations” of such an entity would remain here. Even if it did, however, it is not likely to mean to this area what Anheuser Busch did.

That is certainly unfortunate, as A-B is a one-of-a-kind company and employer. But that, also, is reality.

— 7dez7
12:17 pm May 23rd, 2008

Let’s use some common sense and compare this to other similar mergers, ones that take place with a foreign interest acquiring a local organization. One that everyone in this dicussion has ignored is Nestle and Purina. Did Nestle pull all jobs out of St. Louis? No, that makes no sense. Why manage an established business unit from an overseas location? To everyone speculating mass job loss, please use some sense and at least site some examples of what jobs could possible be done better thousands of miles away. Comparing this to May Company or A.G. Edwards is an apples-to-oranges comparison.

— rached11
12:36 pm May 23rd, 2008

US HQ would remain in STL. STL would still remain a huge player in the US markets.

Cause for alarm is a 1 on a 1-10 scale.

— Iron Mike Ditka
12:38 pm May 23rd, 2008

Does anyone know who owns a majority of Anheisher-Busch stock? Biggest holders are fund management corps like Barclays Global Investments and Berkshire-Hathaway. Busch Family is the 17th largest holder of stock. The institutions are going to take the money and run. They own BUD.

— Patriot
12:40 pm May 23rd, 2008

Welcome to the New World Order!

— Buddy
1:13 pm May 23rd, 2008

rached11, practically any job at the HQ corporate level can be done elsewhere. Anyone with a computer can do accounting whether they’re at an office in St. Louis, Belgium, or the International Space Station. Anyone that does any job on a computer can do that job anywhere in the world thanks to this lovely invention by Al Gore called the internets. I’m sure the people making and distributing the beer in St. Louis will probably still have their jobs to do, but many of the corporate positions can and probably will be streamlined/downsized, which is EXACTLY what happened to May Company and AG Edwards.

— b
1:31 pm May 23rd, 2008

b-you think just because of the internet and a computer that you can manage a company located in St. Louis from Belgium? I don’t deny working virtualy isn’t reality but cultural and physical location considerations need to apply. I don’t understand how you can compare A.G Edwards and May to this potential merger. Those were acquisitions with domestic buyers and can’t be compared. Why not consider my previous comparison with Nestle/Ralston? Why is it that Ralston is still has a large presence in St. Louis when it was acquired by Nestle? In fact why hasn’t anyonne made that comparison. Seems to be more applicable than comparing A.G. Edwards or May Co.

— rached11
1:54 pm May 23rd, 2008

Investors in A-B? You all forgot about Warren Buffett. He personally owns about 5% of the stock and he bought in for about 47.00 per share. Does anyone think he might want to cash out at 65.00? Nice little return huh? Inbev is also known in brewer circles as the leader in cost-cutting to the bone. A LOT of “fat” will be trimmed if this deal goes down.

— dee
2:07 pm May 23rd, 2008

Hi, I work for inbev in Leuven, Belgium. I don’t think much would change if inbev bought A-B. Inbev (and interbrew before that) calls itself “the world ’s local brewer” they have very few global brands (stella artois, becks…) and have very limited presence on the US market. I don’t think anything would change to the way the product is marketed. If the buyout continues there won’t be many synergies, so not a lot of reasons to fire people. And if there are lay-offs they could just as easily happen in Belgium as in the US or any other of the 100+ countries where inbev is operating.
(sorry for any mistakes I’ve written, English is not my native language)

— Cedric V
2:26 pm May 23rd, 2008

Slugger has a point about Hemp… Didn’t they use Hemp oil to power lamps in the 1800’s… I don’t see why it couldn’t be used like Ethenol is used from corn… The original consitution is written on Hemp…

Merger - Anytime an America company is bought be a foreign company it is not good. Several people have pointed to job loss. But there is more, the profits are sent to other country and are forever lose… We are becoming a 3rd world nation in a hurry and if we don’t wake up and chose better leadership… It going downhill fast…

— John
2:34 pm May 23rd, 2008

1992 Interco declares bankruptcy due to its large debt load. This was assumed during an attack by corporate raiders in 1988-89.
1992 Southwestern Bell moves to San Antonio. Later becomes AT&T
1996 Boatmen’s Bancshares bought by NationsBank Corp. Later becomes Bank of America
1997 Fleischman-Hillard is purchased by the Omnicom Group of New York.
1997 McDonnell Douglas bought by Boeing, located in Seattle. Later, the headquarters moves to Chicago
1999 Mercantile Bancorporation is bought by Firstar of Milwaukee. Later becomes US Bank in Minneapolis.
2000 Monsanto is purchased by Pharmacia. Later the company is bought by Pfizer.
2000 GenAmerica is bought by MetLife, now of New York
2000 Mallinckrodt is bought by Tyco International of New Jersey. Tyco Healthcare (a large portion of which is Mallinckrodt) is split off in 2006 headquartered in Massachusetts.
2001 Ralston Purina is bought by Nestle, of Switzerland.
2001 TWA goes bankrupt and the assets are purchased by American Airlines of Dallas.
2004 Rawlings is bought by K2 Sports, now based in Seattle.
2004 Bridge Communications is bought by Reuters. Later purchased by Thomson, located in New York.
2005 May Department Stores is bought by Federated Department Stores of Cincinnati.
2006 Pulitzer is bought by Lee Enterprises of Davenport.
2007 A.G. Edwards is bought by Wachovia of Charlotte

This is not a comprehensive list and there are companies that have ‘grown up’ since the early 90s. But I think this does identify a trend. The death of corporate St. Louis.

— Fyten
2:39 pm May 23rd, 2008

Rached11, I don’t think that AB is going to disappear, and I don’t think every job can be done properly from abroad. No group of employees can be run properly without some level of managerial presence. But I don’t think that it’s unreasonable to expect much of what is being done at AB to be slimmed down. If bought out, I don’t think they will need many jobs in St. Louis’ IT staff or accounting staff or marketing staff as many of those functions can be incorporated into aleady existing jobs.

— b
2:50 pm May 23rd, 2008

Totally agree with Dee. This has been coming. Wall Street has been well aware of the rampant nepotism and cronyism that permeates the brewery. “Who you know” has never applied to a company more fittingly than A-B. They have hundreds of highly compensated execs that really don’t do anything or posess noticeable talents. That’s one reason why their stock price and U.S. market share hasn’t moved much in years. Wall Street seldom confuses size with performance. That’s why it took these rumors to finally move the stock. InBev has little or no U.S. presence, so I suspect they’ll still brew beer here and some of the HQ jobs will remain, but it will take an outside company like InBev to peel away the layers of obvious fat. A-B has always been unwilling to do that themselves. Besides, it’s just beer, they’re not curing cancer.

— JE
3:11 pm May 23rd, 2008

Cedric - Your written English is much better than the average St. Louisan. Thanks for your comments.
Fyten - Good list. Don’t forget the Rams in 2010.
Slugger - WOW. Just…WOW.

— Jabba
3:41 pm May 23rd, 2008

I know that in some respects the takeover may make some business sense. But, the Busch family and the board need to consider the rich history of their company, it’s culture, and economic impact of not only St. Louis, but the breweries around the country. Business sense or not, this is a really bad idea. If this takeover goes through, they can kiss their history and culture goodbye. This company needs to stay with local ownership and in the St. Louis area. I know better, but shareholders need to consider these things too instead of making a quick buck!

— Scott
6:12 pm May 23rd, 2008

After I went last week in an A-B Tour in St. Louis, I was right: a brewer made using rice can not be space in the global world! Sell right now to Belgium and Brazilian Company.

— Andre Vieira
8:00 pm May 23rd, 2008

If this happens, this will be the end of St. Louis as we know it (which has been in economic decline for decades). I pray it doesn’t happen but, if it does, it will be a disaster.

— Rob
12:59 am May 24th, 2008

It seems that this has been a long time coming. The rumor has been around for years and the distribution agreement with InBev was a trial run. They have demonstrated their value be increasing sales of InBev products. It must have been successful - hence the offer. If inBev not only gets to own the AB Brands, but can more increase the sales of its own products through ABs distribution channels, the offer price is way low.

I think there will be a backlash against the brands simply because it is such a strong US brand. At some point people are going to realize it does matter who owns the company.

As for the board having the fiduciary responsibility to sell the company… If the board was a farmer, and the company the cow, the farmer doesnt have to sell the cow when beef prices go up or milk prices go down. They have the responsibility to keep the cow healthy. Sounds like BS double-talk to me - but you hear it repeated until people actually believe it.

— SadDay
7:53 am May 24th, 2008

I personally know August Busch IV, and many others in the Busch corporate family. They’re great people, committed to St. Louis and charitable as heck around the world. But realistically their inability to be more aggressive in a lucrative global economy has hurt the company and us stockholders. Since a kid, it was always thought that A-B stock was a blue chip work-horse,not of late. Their belated entry into the global market, while our competition has dominated many high revenue areas has hurt the long-term economic growth of our company. The semi-retirement of August, (III) one of the world’s most intense, but brilliant business tycoons has hurt our investments. August Busch IV and his family DO NOT control A-B’s future, we do — the stockholders, many have some of our retirement funds invested in A-B. For many of us thisclose to retirement, we need to start converting some stock into the next phase — and I’ve personally been waiting for a miracle on Wall Street and Busch Place. It NOW has arrived. The community should appreciate that it takes millions to re-build these brewerys, and the potential groom (buyer) should take interest in protecting the A-B brand, by having it’s U.S. headquarters in the City of St. Louis. It’s to their full economnic benefit, as well as ours. The groom needs to put some more gold on the table, and let’s get this marriage rocking and rolling.

— Gentry W. Trotter
8:01 am May 24th, 2008

I think it is a shame how so many are concerned a few extra dollars now for a trade off for the future. Granted who is to say what might happen but being bought out by a by a foreign company is not the way to go. Look around how many profits go out of this country, how many people are out of work because a toy that (hopefully has no lead in it) is cheaper and that it helps that company stock rise is made overseas. Anhueser-Busch has been a leader for over a 150 years it may not be the biggest anymore granted that it took every other brewer to merge with someone else to top A-B.For Anheuser-Busch to control almost half the US market share they must be doing something right. If given time I have no doubt the the same will happen oversea with such a great company and 1 beer.I will say that my wife works for A-B and she loves it that company ranked 1 to work for is a dream for most and a privilage for those who do. For the benefits they receive and the high apprciation that they are shown.
I work for a homebuilder that was sold to a larger out of state builder. We we told how much better thing would be because of their guidance and able to make more money. This is true that they made better profits but along the way we were told that we were not building houses correctly for the last 50 years. They cut costs the materials we used were cheaper and poor quality, saftey awards were taken away, company christmas parties and family day were either removed or scaled back and the paper work rose by 50%.
So being talken over by someone who cost cut may be good for your investor but what about the employees who have worked there for years. SO I guess if you think making a little money is great then it makes sense. But as someone that has family and stock in A-B and believes in american owned and made products you should see this a bad thing, no matter who you are.
My suggestion is for August to send Inbev a case of BUDWIESER and tell them to GO TO HELL.
Lets stay american and show that we are not just a country that can no longer handle its own business by ourselves.

— jc
8:51 am May 24th, 2008

This what happens when the CEO search committee does a search for the best candidate in a family instead of a real search. I can hear the new tag on the TV ads, “InBev-Anheuser Busch, Leuven, Belgium.”

If this happens, one of the first thing that will happen after firing anyone who has anything to do with the public company aspects of AB will be an analysis on the efficiency of the infrastructure. I don’t know how efficient the old brewery in the City is versus newer plants elsewhere, but I do know the city earnings tax will not be helpful in the equation. This will end up costing the city and state plenty in incentives for it to stay, if it does. If it leaves, I fear for the solvency of the City. When May, TWA and AG Edwards left they said we were turning into Wichita. AB leaves Wichita will sound good.

— flyover
11:09 am May 24th, 2008

Bring back prohibition. The products these companies make have been responsible for more misery than anyone can imagine.

— Marco
11:43 am May 24th, 2008

Ya mad at da bombers…yet ya let the tower livers sell you out. Ya pay dere tax for dem. WTF? Quit da prostrate nad licking of da wall street demons. You fault…you fault!

— La Rushbush Be Loo
11:47 am May 24th, 2008

I agree with Marco! It’s beer’s fault…not the people drinking it! I would like to also ban sugar. Sugar is the reason people are fat. I would also like to suggest banning guns. They are the reason people die…not the people shooting them. And cars? Don’t get me started!

— Logicprevails
11:53 am May 24th, 2008

St. Louis has suffered immeasurably for decades due to its stifling conservatism and aversion to change. By the time we adapt to changes, the world has changed again and the changes we finally make are too late and usually misguided due to changing conditions. St. Louis was once a prosperous, proud metropolitan area that was one of America’s 10 largest. Today, we will soon drop out of the top 20. Who cares, some say. We should care about this more than anything because lack of growth means lack of new jobs, and the opportunity that goes with that growth. Plus billions in lower property values to boot. Because of our conservatism, St. Louis companies don’t expand and prosper, they get sold. Anheuser-Busch has followed the same pattern that McDonnell Douglas, May, Ralston Purina and dozens of others have followed. Anheuser-Busch spent years with its head buried in the sand afraid to take bold steps, while the rest of the brewing world left it in the dust. We sit smugly saying it couldn’t be helped, and we like things here the way they’ve always been, but that is nothing but a cop-out to make ourselves feel a little better in this world that’s rushing by us so quickly. We blame corporate greed for out of town companies buying us and closing shop here, but don’t question why our hometown companies didn’t expand with the times. We blame free trade agreements as to why manufacturing jobs have left, and acknowledge that the only new jobs are in those tech businesses that are in other parts of the country, but don’t question why we have one of the most uneducated populations in the country. We sheepishly say we’ve always been a quiet family friendly town, but how family friendly are we when our families end up torn apart because our brightest young children move away to more exciting, growing cities with better opportunities? Will we ever learn?

— Scott
12:34 pm May 24th, 2008

Scott, we will never “learn” because that would involve having to change. A century from now, St. Louis will be another Wichita, like another blogger commented, and people (from out of town) will write books about us saying how pathetic it is that the people of St. Louis never “got it,” and suffered so terribly as a result. We’ll continue our pathetic existence, blaming the world for our problems that are nothing but our own doing when you really think about it. We can’t change the world. The ONLY thing we can do in order to prosper in this world is to adapt to it. Since we’re not willing to do it, because adapting by definition means to change, all we can do is continue struggling to make ends meet, complaining about how cold and greedy the world is, contining to do things the way we always have, at all costs, driving forward dangerously with our eyes fixed firmly on the rearview mirror. What we should be doing is devote all our energy into adapting to the reality in which we live, but that will never happen, because we’re St. Louis. I am a St. Louisan, but there is now a “for sale” sign in front of my house. I’ll be watching the fallout as the area continues going down in flames from a safe distance.

— James
12:51 pm May 24th, 2008

Want to solve the energy crisis? Attach a cable to Gussie’s headstone. He’s turning over in his grave so fast he could power the whole region.

— flyover
1:08 pm May 24th, 2008

I am impressed that you are all taking the gloom and doom approach and have A-B packing up and selling. Maybe this is what the problem is in St. Louis, no support from its people.
Lets have a little hope and think that August IV will do the right move with the board and not be remebered as the last Busch that sold the company

— jc
2:27 pm May 24th, 2008

After the news broke, shares of A-B rose 6% and shares of inBev dropped 3%. To give an idea of what the market thinks about the deal…

— Cedric V
4:04 pm May 24th, 2008

If this is true I guess I will be finding a new ”AMERICAN” beer to drink, Shame on A-B for not coming out against this. I’ll bet all the good paying jobs for the factory workers are on the line if the sale goes through.

— Kevin
4:09 pm May 24th, 2008

Let’s be clear, it isn’t up to Busch IV. It will be up to the Board which isn’t made up of Gussie’s buddies anymore. There are sixteen members of the board. Ten of them are not from St. Louis. These folks, thanks to Sarbannes Oxley, have only one oblgation and that is to make the best decision for all the shareholders. The fate of St. Louis will not even be a factor. Oh, and one of those directors is Ed Whiteacre, the guy who moved SBC to Texas after the legend says they wouldn’t let him into St. Louis Country Club, (I do not know if this is really true). The board, who won’t want to get sued, will form a special committee of independent directors (non-management) hire Goldman Sachs, or some bg bank to evaluate the deal and they will vote based only on that opinion, because that protects them from litigation. The board can hold out, but in the end, the suitor can always file a proxy and go directly to the shareholders, most of whom don’t live here either. Ten funds own almost thirty percent of the company, according to Yahoo Finance. If the buyer convinces them, they only need 20 more percent to get to 51% which is all you need.

— flyover
4:32 pm May 24th, 2008

A-B being bought our would devastate St. Louis’s economy. The number of cuts and lay offs InBev would make would make A-B a small player in a town it used to be the King of…the last great american brewer and st. louis could be dead.

— Jake
8:57 pm May 24th, 2008

Dont listen to anyone who works for InBev about the cost cuttting and fat-cutting that occurs. No matter what you hear - it happens far mor and deeper than you can imagine. If you want an example - look at Labatt in Canada. InBev came in and kept the local HQ in Toronto - but cut a lot of jobs. People up there are now working with departments of 3 instead of 20 because fewer people were needed on the ground.

— Jake
9:08 pm May 24th, 2008

The only thing most of us can do is wait and see. I’ve heard these rumors before and it won’t be the last. Chances are they are true, but nothing has been anounced either way by either company. Sources were not named, so whose to say that the rumor wasn’t started by someone wanting to sell their A-B stock? Yes it might be a bad thing. I would imagine that the fat would be cut from the work force but I believe that Budweiser will be brewed in St.Louis, Mo in another 150 years. InBev needs the production to keep rolling or what good is it to buy a company and then shut off it’s biggest artery? Be patient, the sky is not falling yet. Besides it could mean bigger and better things for everyone involed.

— Todd
12:02 am May 25th, 2008

it is clear that the 18 month inbev takeover rumors are true. david nicklaus’ sunday PD article was succinct & on target, but the article merely summarized what many already knew & feared. i have friends at a-b who are shaken in their boots about what this would mean. to me, vast layoffs and job consolidations would result across all sectors. 50% of the corporate workforce could be eliminated and no one would bat an eye. the fact that august IV & III have said nothing is an ominous sign. the busches are defenseless to stop inbev if inbev makes an offer. no shareholder seeking stock value would vote against inbev’s takeover. it would take a lifetime for current management to take this once proud company to $65 per share. inbev could do it overnight. a-b’s stock has languished in the $40’s for much of the last decade. i feel for my friends who face uncertainty, but for me, a small shareholder, it is good news.

— gman1958
8:30 am May 25th, 2008

I work for A-B, blue collar, my take is that this will probably happen within a year or so. But I don’t see it affecting St. Louis, the brewery will still be here, the HQ will still be here. In Bev needs A/B it’s products, it’s status in the U.S. market, and it’s network of distributors in tack in order to make this venture successful. Any drastic change in marketing approach or production of the product would be detrimental to the sales of current domestic beers, and introduction of imports with any hope of significant sales nearly impossible. Thats just the way I see it.
One question I do have, is if this goes through would it be ALL of A/B, I mean the Entertainment Divisions, Can production Divisions, etc. I don’t see In Bev wanting these other divisions, they are strictly beverage. Anyone have any ideas??

— RR53
8:33 am May 25th, 2008

Buyers create what is called an accretion/dilution model of life after the acquisition. If they determine the business is worth more cut into parts, they will plan to spin-off the pieces that don’t contribute to the core business. Often, a business is worth more in pieces than together. This is more than a rumor. It was the lead story on the front page of yesterday’s Wall Street Journal. They don’t give baseless rumors that kind of space.

The real victims will be the rank and file and the City of St. Louis. The ironinc part of this is the funds that often push the hardest for business combinations are the pension funds that represent the most liberal constituencies, e.g. teacher’s pension funds, state and municipal pension funds, etc. These funds have been on a decade long campaign against excessive executive compensation and what they feel is corporate waste in order to get the stock prices (and their funds) higher. The ironic part is these efforts at corporate streamlining (layoffs) and mergers is that they hurt the little guy these funds represent. One man’s corporate waste is another man’s civic donation. Trust me, the shareholders don’t care about the City Schools, or if the MSD tax increase passes. All they care about is how high they can get the stock price. So, all that AB stuff you’ve been getting for your church auction, every time the brewery has bailed out some local problem…I wouldn’t count on it if this happens.

— flyover
10:25 am May 25th, 2008

I still think ths chances of this happening are slim. One as on of the previous writers wrote the board is made up of 10 members that are from out of town, I guess you could could say this might be bad but I doubt it.Of those directors only 1 has been there not that long since 2001. You must remeber who is the chairman of the board August III , I would be willing to bet the board would not go against him and most of these people are hand picked for a reason. Also it has been quoted by August the IV that thier are measures in place to make sure that this does not happen. The variable in this is the stockholders, I have not been able to find any fund that has more then 5% of stock todate so that would mean that would have to convince alot of people and groups. So here is a thought for shareholders, yes lets get $65 a share right now we all can be rich if we sell it right a way but how know what the stock price will do 10 years from now when more of retire or we can say no because we wnat a company not only run be reat buisnessmen but a long, long line of proud brewers that will take this company no where but up. A-B has delivered nicely on it share of return and on being able to raise dividends for it stock holders. Lets leave the authority to the ones that really know how to make and deliever quality in the beer making buisness. Not to buisness men that know nothing about making beer and only about taking other companies because they can not survive on their only, But to the true KING OF BEER the Busch’s and there long line of tradion and quality.
Long live the king

— jc
11:57 am May 25th, 2008

If this does happen, I can see a lot of negative press and bad PR for the brewing giant. Their image has always been one of true Americana, the success story of the Busch family, the Clydesdales, the association with the Cards, the Superbowl, etc. Whether you are a Budweiser drinker or not, you can’t deny that this brewing giant has carved out a mental territory in the heads of its customers as something as American as apple pie, Coca-Cola or McDonald’s. If this sale goes through, it may cause a backlash/unorganized boycott amongst its core demographic, the average joe beer drinker. It may come to pass that these folks, especially those who are very brand-loyal, the company will lose. Perhaps they wiil find new customers for its InBev products.

— anniegirl09
9:31 am May 26th, 2008

Hey gman1958 I am glad as a small share holder you are more concerned with the small profit you may make for the short term compared to the employees,and families that are associated with A-B that will lose out over the long term. Not to mention a nother foriegn company buying an american company.
I might be over stepping here but you seem like the type that would love to make money on the stocks that bring us the lead toys from china. My suggestion move to Europe.

— jc
3:10 pm May 26th, 2008

Worrying just won’t fix it…..life goes on.

— momama
4:49 pm May 26th, 2008

Add Aloe/Sherwood Medical, HQ in STL, bought out in 1998 by Dennis Koslowski and Tyco, based in the Bahamas. Ever heard of Aloe Plaza? Yup. All gone.

It is really difficult for any family to keep a company going for more than three generations. A-B has for about 5, I think. In that sense they are a success.

Maybe,if they sell, one of the Busches (if interested) will pull an Edwards, like that A.G. Edwards scion who just started a brokerage in Clayton.

As long as they don’t quit producing Busch brand (which is sort of local– try to get it elsewhere in the country). Otherwise, I will become a former beer drinker.

— Teresa
5:07 pm May 26th, 2008

A-B has grown quickly and agressively, buying up other companies around the world–almost dizzyingly-so, for a “conservative St. Louis company.” You can’t fault them for playing the corporate game. But just like it has made acquisitions, it is possible to be bought out itself.

Most people here are lamenting the declining status of St. Louis. Business HQ’s are a measure of status, including the executives and leadership they contain. But there are other forms of leadership, and status.

Look to Sen. Danforth and Joe Edwards. They’re still alive and kicking, making improvements to our community. Look at the countless foundations and volunteer groups that raise money and make improvements to Forest Park and the Gateway Mall. Even if A-B gets sold, the Busches will still be in St. Louis contributing mightily.

For every change, there is always a new opportunity. This could be an opportunity to recognize the local talent we possess in St. Louis. We are still Americans, we believe in pulling ourselves up by our bootstraps, doing what we can for ourselves, and helping our neighbors. You DON’T get that in Europe.

— Ryan A
3:44 pm May 27th, 2008

STL is becoming the new Detroit!

— fromStChuck
6:52 am May 28th, 2008

There are still local brewers who make a good beer that isn’t packed with cheap rice. Schlafly, O’Fallon, and others would appreciate your local business and make much more flavorful products anyway. Drink local!

— Cup_Hungry
9:03 am May 28th, 2008

The A-B buyout is part of a bigger picture of how our local leaders share the lack of self-confidence that so many of us have. We have a great metropolitan area, and some great companies founded here, although as was said before on this blog, St. Louis companies get sold rather than have the vision to expand. St. Louis may be a shadow of our former self, but we are still one to be contended with. If A-B is sold, we should blame August Busch III, not the 4th, because he sat pat for years while he should have been expanding globally. People have been saying it for decades, but he was too stubborn to change. Sounds like someone born and raised in St. Louis, doesn’t it? If August 4th had any balls, he’d turn the tables and buy InBEV. We’re just about the same size and have more to gain than InBEV has if they were to buy us.

— James
8:58 am May 29th, 2008

It’s kind of weird to see changes like this happen at the places I used to work:
- National Supermarkets
- Brown Shoe
- AG Edwards
- Famous-Barr (May Dept. Stores)
and now Anheuser-Busch (as consultant)

You can’t really win for losing.

If the shareholders’ money stays local, stability is there on EPS, but the chance of vultures circling over you is high.

If the shareholders’ money goes global, EPS can possibly go up, but employee morale and loyalty is low.

$65 per share versus shareholder loyalty to the Busch family and the employees…Hmmmmm!!!!

— DC
1:23 pm June 1st, 2008

This is a VERY alarming development, I just learned of it today and have been reading a variety of sources. I think this would be disastrous for St. Louis, not to mention for AB employees. It seems that the economic interests of shareholders might win out! Reports that I have read include hopes that Warren Buffet will make a strong case against the merger in supporting family business (Reuters, at http://news.yahoo.com/s/nm/20080529/bs_nm/anheuserbusch_wsj_dc_1), as well as speculations that he has in fact been planning such a merger since he purchased large amounts of AB stock (Wall Street Journal, at http://blogs.wsj.com/deals/2008/05/28/will-buffet-support-an-anheuser-sale-study-gillette-for-one-answer/)

As a native St. Louisan, my first reaction to this takeover is very emotional. Although I haven’t followed this closely and am not intimately aware of the details, I think this a very alarming development and am interested in learning about how to organize efforts to stop (the radical idea of organizing a mass purchase of stock to vote against the merger comes to mind).

— Kim M
3:35 pm June 1st, 2008

What the hell happened?A.B.is going down?no surprise.i will bet large numbers of people commenting about saint louis losing one of their prized economic gems are driving around in foreign made automobiles.have stock portfolios with investments in foreign countries. this probably includes some of those a.b. stockholders. booking travel to foreign destinations for vacations. spending thosands on foreign soil. making these countries more ecomically wealthy. the newest trend by companies as well as individuals is investing in chinese communist companys for a fast buck.flying to dubai to gamble instead of american destinations.lets buy a foreign made rifle.coffee maker.a.t.v.pick-up truck. hand tool.t.v. set.hair dryer.lets be fashionable and say ” WE HAVE GONE GLOBAL”what americans and their elected officials and corporate leaders have said is we have given the store away for a fist full of cash. “GLOBAL” means no pensions.no medical.no overtime.no paid holidays.no sick leave.no. no. no to you slaves.we have sucked the blood out of our own nation and destroyed our economy by selling off thousands of american companies resulting in the destruction of thousand and thousands of jobs. selling a.b. means the selling of our national pride. community pride. pestalozzi street.the clysdales.busch stadium old and new.the cardinals.mark mcguire and 70 home runs.remember.”AUGGIE BUSCH”.jack buck.grants farm. family traditions of a.b. employment. good wages.great pensions.family security.and most of all a trip down seventh street to smell the “greatest brew on earth” sorry inbev. our traditions. our values.our “AMERICAN MADE” company is not for sale.go buy some oil wells in saudi arabia.you will make more money.resist. and we call in “JOHN WAYNE AND THE CAVALRY” chuck norris and some flying feet.how about clint eastwood and a little bit of “MAKE MY DAY” not for sale.ever.thats my story and i am sticking to it.

— michael shannon
9:38 am June 2nd, 2008

look at all the retires from the ab system nation wide that will loose all there insurance the day after the deal is signed. everybody over 65 will loose everything.

— BILL
3:47 pm June 4th, 2008

I think it’s a pitty that we all just lay down to this “new world order”, as if we have no other options - *****! Why is it that we readily accept globalization/Westernization/cultural annihilation/gentrification, etc. as the way of the future? It is exactly this type of thinking and acceptance that set’s the stage for these types of takeovers. It is the abscence of the sacred that detroys our humanity, leaves us crying poor, jobless and hungry, dating on line, suffering emotional crises and dying.

— mae
10:19 am June 5th, 2008

When will it stop?..globalization seems to be in direct conflict with community pride. “the Great South American-managed Belgian-owned Lager” just doesn’t sound the same. It’s more than sad, it is very disturbing, I just don’t know what to do about it.

— c kepley
6:51 pm June 11th, 2008

France avoided Pepsico’s takeover of Dannon yogurt by first passing a law protecting France’s “strategic” industries and then defining yogurt as strategic. Why can’t American companies get away with this? If Dannon yogurt can be considered strategic certainly AB can too.

— John
2:16 pm June 13th, 2008