Who’s this Bud for?
Merger could affect local distributor
By Brian Egeston
be@brianwritses.com
Eagle Rock distributor in Stone Mountain sells Anheuser-Busch products. Photo by Brian Egeston. |
News spread across the business world this week when Anheuser-Busch agreed to a $52 billion buyout by Belgian brewer InBev. Under the name of Anheuser-Busch InBev, the
new company would be the world’s largest brewer and the fourth-largest consumer product company.
“This combination will create a stronger, more competitive global company with an unrivaled worldwide brand portfolio nd distribution network, with reat potential for growth all over the world,” said Carlos Brito, CEO of InBev, in a statement.
Brito will remain CEO of the combined company. Anheuser-Busch shareholders will receive $70 a share.
The company balked at $65 a share offer in June, which set off a corporate war when InBev sought to remove all 13 of Anheuser-Busch’s board members. Anheuser-Busch filed suit claiming that InBev was plotting an illegal scheme that threatened to defraud Anheuser- Busch shareholders. The American brewery noted in the suit that InBev did not disclose the fact that it operates a brewery in Cuba where American companies don’t do business. InBev fermented the deal and made the newest offer, is now up for approval. Eagle Rock Distributing Company in Stone Mountain is one of 19 Anheuser-Busch wholesalers in Georgia. The company and its 175 full-time employees distribute eight lines of the Budweiser product to more than 2,000 retail customers. The facility located just off Hwy 78 has an 80,000-squarefoot refrigerated warehouse and computer-based inventory system.
“We just don’t see much of a change,” said Steve Craine, president of Eagle Rock. “It’s
been rumored for about a year so we’re not as shocked as some people. They’re gonna
keep all the breweries open and certainly we get a lot of beer from Cartersville. We’re
excited about a new chapter for Anheuser-Busch and the opportunity for them to compete
on a global stage.”
Matt Simpson is a beer sommelier who teaches Beer Education 101 at Emory University. He gravitates toward more complex microbrews, but admits that America hasa craving for mass-produced light American laggers. Despite Budweiser’s strength in the market, smaller breweries have been gaining ground. “If you look at the Brewer’s associations, you’ll see that the craft beer industry has been growing exponentially for that last decade and the last two years it’s really exploded. In 2007 craft beer had higher
gross sales than any other beverage in the adult beverage industry.”
Anheuser-Busch brews their version of craft beers and to diversify their product line
they own the Mexican company, Grupo Modelo. The announcement has raised attention
in Mexico. In a statement Grupo Modelo said the following, “Our agreement with Anheuser-Busch was carefully constructed to ensure we have a definitive say in who our partner is. We are confident that our agreement, which is governed by Mexican law, gives us the right to decide whether or not to consent to the potential acquisition of Anheuser-Busch by InBev.”
Anheuser-Busch employs nearly 6,000 people in the St. Louis area. The company name
is emblazoned on several venues throughout the city from baseball stadiums to buildings. InBev said it will keep St. Louis as it’s North American headquarters.
“Mergers often are followed by consolidation and cost-cutting measures,” said Clifton Green an Emory economics professor. “One of the draws of Anheuser-Busch from InBev's perspective was access to their distribution channels. It's possible the merger could be a boon to certain local distributors by adding new InBev product lines. On the other hand, in markets where Anheuser-Busch and InBev products have tended to be distributed separately, distributors in those areas may face consolidation.”
Green also noted that Senator John McCain, has major ties to Anheuser-Busch. His wife, Cindy, is chairwoman of Hensley & Company a large Anheuser distributor. Mrs. McCain holds a significant amount of Anheuser stock. The McCains publicly opposed the buyout of the American company.
In 1860 Eberhard Anheuser acquired the Bavarian brewery and renamed it E. Anheuser & Co. In 1864 his son-in-law, Adolphus Busch, joined the company and it was renamed Anheuser-Busch. During Prohibition in
the Untied States, the company sold products such as ice cream,corn syrup, ginger ale, root beer,yeast, malt extract, refrigerated cabinets, and automobile and truck bodies. After the ban on booze ended, a cart pulled by Clydesdale horses strutted up Pennsylvania Avenue and delivered a case of beer to President Franklin Roosevelt.
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