Belgian Brewer Battles For Anheuser-Busch

(CBS/AP)  Brewer InBev says it will file a statement with U.S. regulators, seeking to remove the entire board of Anheuser-Busch, turning up the heat in its $46 billion unsolicited bid for its U.S. rival.

It is proposing its own board for Anheuser, which includes Adolphus Busch IV, the uncle of CEO August Busch IV.

InBev said in a statement it would file a preliminary consent solicitation with the Securities and Exchange Commission later Monday.

The maker of Stella Artois claimed its hand has been forced because Anheuser has refused to enter takeover talks.

Anheuser-Busch Cos rejected an unsolicited $46 billion purchase offer from InBev at the end of June, just hours after the Belgian brewer appeared to set the stage for a hostile takeover bid.

August Busch IV sent a letter to InBev Chief Executive Carlos Brito saying the offer greatly undervalued the largest U.S. brewer, calling the $65-a-share price "financially inadequate" and not in the best interests of its shareholders.

"From your standpoint, we see that now could be opportunistic timing for you to make this acquisition, given the weak U.S. dollar and sluggish U.S. stock market," Busch said in the letter. "From the standpoint of the Anheuser-Busch shareholder, however, a transaction with InBev at this time would mean forgoing the greater value obtainable from Anheuser-Busch's strategic growth plan."

InBev filed a suit the same day in Delaware court, where Anheuser-Busch is incorporated, seeking to officially declare that shareholders can remove all 13 members of Anheuser-Busch's board. It was the first step to rally Anheuser-Busch shareholders to accept InBev's offer, even if management is opposed to it.

"This is an extremely aggressive step," said Douglas Cogen, a mergers and acquisitions attorney with the Fenwick & West law firm in San Francisco.

In most acquisitions, a rejection from the target company's board of directors might draw out a sweeter offer. InBev's move suggested it was not interested in a lot of bartering, Cogen said.

Busch said in his letter to Brito that Anheuser-Busch had its own plan to boost its stock price. The stock was trading around $50 before speculation began to simmer about InBev's all-cash offer of $65 a share.

"Our company already has developed a detailed, accelerated earnings growth plan ..." Busch said in the letter. The company plans to expand its cost-cutting initiative, called the Blue Ocean, to save more than $750 million through 2009, and save $1 billion through 2010.

The company also plans to drive additional sales for its core brands of Budweiser and Bud Light through "new consumer opportunities."

The letter did not lay out details for these plans, nor set a specific timeframe by which Anheuser-Busch could boost share value.

Shares of the U.S. brewer fell 41 cents to $61.35 in trading after news of the buyout rejection.

[dchu76]

***, I was just in awe of a hostile take over with Microsoft, now beer?! Does this mean Budweiser is going to be considered an import now, because I really need a good laugh. How is it even possible to literally force a company to sell, though? I can''''t even wrap my head around it.
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Posted by spadeisspade at 11:52 PM : Jul 07, 2008

They can force in basic terms an election. If they get a percentage of shareholders to agree (35%) then they can force a shareholders meeting. Where all the shareholders get to yay or nay the deal through proxy. And if InBev gets enough votes the deal goes through. Remember its a public company where majority rules. Teh shareholders in turn can take cash for the shares or get new shares issued to them for the new company.

[spadeisspade]

***, I was just in awe of a hostile take over with Microsoft, now beer?! Does this mean Budweiser is going to be considered an import now, because I really need a good laugh. How is it even possible to literally force a company to sell, though? I can''t even wrap my head around it.

[standncount]

Well I for one will not purchase Budweiser products if it is sold to a foreign company. The Beer is an American icon as is the company. In-Bev will go "Flat" if they are successful in their quest.

[shawnp20]

Hey Belgium......... they don''t want to sell!!! Not to you... not to anyone!!! Get over it!!!

[forasongca]

At least the Belgians know how to make decent-tasting beer...

[magoo2u1]

"No loss Bud the worst tasting beer on earth ugg"

Jerryomara, You sir are a LIAR! American beers have no taste !! if Becks (a tasty beer) purchases A-Bush and adds flavor to the beer ,who will we look down our noses at ? Wine drinkers? Hardly, they are busy looking down their noses at us.

[whitemale08]

Posted by hbevis at 11:48 AM : Jul 07, 2008-

I hear ya, what Bush has done is done but we all need to agree on who is the enemy and take ''em down.

The Federal Reserve System needs to go into receivership by Congress so it can conduct bankruptcy. Then a new Bretton-Woods conference among the more powerfull nations like China, India, Russia and U.S. of course to hammer a frame work of a new Gold Standard and get rid of this floating exchange rate nonsense.

That way soveriegn nations are protected from exploitation and agreements like NAFTA would be forced to be fair trade instead of free trade garbage.

[Gary Kempf]

I don''t like anything Anheuser-Busch makes, but Anheuser-Busch should tell InBev they might consider selling them a couple of their Clydesdale''s for 64 Million, But Anheuser-Bush would still retain the rights to them.

[dchu76]

YAY for the weak american dollar, and when(if) the dollar rebounds the profit goes over seas. YAY

Ah the days when belgium is loaning america money.

[hbevis]

I am convinced that the only way to save these companies is to either re-do or get rid of NAFTA.

I keep saying this but it seems that nobody cares as all some people want to do is bash Bush. I know that he should have been gone four years ago. That did not happen but we are almost done with him. We need to be focused on getting our Country straighted out. If we allow these foreign Countries to keep on buying our companies we are lost.

This "one world order" business is total BS.

We are losing big time with this program.