Anheuser-Busch Agrees To Belgian Buyout

European Beverage Giant InBev To Acquire Iconic American Brewer Of Budweiser For $52 Billion

(AP)  Brewer InBev SA said Monday it will buy U.S. rival Anheuser-Busch for $52 billion to create the world's largest brewer.

The deal sees control over America's largest brewer move overseas as it forms the fourth-largest consumer product company under the name of Anheuser-Busch InBev.

InBev promises that the takeover will help global best seller Budweiser expand into emerging markets like China, Russia and Brazil, generating large profits as costs rise and revenue from beer sales in North America and Europe fall flat.

InBev said Anheuser's board had unanimously accepted a sweetened takeover offer of $70 a share - up from an initial bid of $65 a share that Anheuser rejected as too low in June - just days after both companies initiated legal action that signaled the start of a hostile battle.

The two said in a joint statement that they believed the transaction was in the best interests of both, forming a global company with strong roots in the U.S. where it will also draw 40 percent of its revenue.

They said they expect cost synergies of at least $1.5 billion a year by 2011 over three years. The deal won't benefit earnings per share until 2010, they said.

InBev, based in Leuven, Belgium, committed to keeping all of Anheuser's U.S. breweries open, saying Anheuser's St. Louis headquarters would take charge of all North American operations and remain the global home of the flagship Budweiser brand. Anheuser-Busch has more than 48 percent of the American market.

InBev's Carlos Brito, a Brazilian national, will be chief executive of the new company, heading a board that keeps Anheuser chief executive August Busch IV and one other Anheuser board member.

For InBev, the maker of Stella Artois and Beck's, the deal gives an aggressive company an iconic beer brand - Budweiser - to sell into emerging markets where it has already established a firm footprint.

It says it is the number one brewer in 10 markets where Budweiser only has a very limited presence and has a better grip on nine markets where Budweiser sells.

It will be the biggest beer seller in the world's top markets of China, U.S., Russia, Brazil and Germany and promises "significant growth opportunities" from taking Budweiser and other beers across the world.

"Together, Anheuser-Busch and InBev will be able to accomplish much more than each can on its own," Brito said in a statement.

"This combination will create a stronger, more competitive global company with an unrivaled worldwide brand portfolio and distribution network, with great potential for growth all over the world," he said.

Shareholders of both companies must approve the takeover which will also need to be cleared by U.S. and EU antitrust regulators.

InBev SA announced on June 11 that it would bid for Anheuser-Busch after long speculation that the companies were in talks - although neither would confirm more than talks about a deal for Anheuser-Busch to distribute InBev's beers in the U.S.

Anheuser voted against the merger, prompting some bitter squabbling as InBev filed a motion seeking the removal of all 13 Anheuser-Busch board members; Anheuser-Busch filed suit calling the InBev effort an "illegal scheme" that threatened to defraud Anheuser-Busch shareholders. Among other things, the suit noted that InBev failed to disclose it operates a brewery in Cuba.

Fears that InBev would make layoffs saw some U.S. politicians and civic leaders speak out against the deal. At least two Web sites also sprung up opposing the merger. SaveBudweiser.com claims to have more than 60,000 signatures from merger opponents. SaveAB.com hosted a recent anti-merger rally that drew hundreds to downtown St. Louis.

InBev is renowned for shaving costs since it was formed in a 2004 merger between Belgium's Interbrew and Brazil-based AmBev. The company has not said if it will shed Anheuser-Busch staff to make savings. But some cutbacks seem likely.

Even without the merger, Anheuser-Busch said last month it planned to cut pension and health benefits for salaried employees as part of an effort to slash $1 billion in costs by the end of 2010. The plan called for offering early retirement to 1,300 salaried workers 55 and older.

The beer industry has been consolidating in recent years amid rising costs for transportation fuel, aluminum for beer cans and key ingredients such as hops.

[eggy1620]

You wanna make AB an American owned company again? Then start purchasing shares of InBev.

[eggy1620]

American owned means nothing anymore. Publicly traded does not mean only US citizens can own the stock. Anyone in the world can own stock in a company headquartered in the US.

[tibu987]

The selling of America....continued.

[rgoodiel]

That is why I said "American Owned"...it makes a difference!!

[ibzjem]

I bet a case of Miller light that your American car was designed in Japan and potentially built there too. Ther is no completely American car or Japanese car. This is a global economy. WWII was over long ago. Amazing how some people are still fighting it.

[rgoodiel]

I would bet a case of Bud that 30% of you that are saying you are never buying another AB product own a Toyota, Honda or Nissan. If you are going to whine about buying an American beer, why don''t you buy a car made by an American owned company? Yes the deal sux and I don''t like it either, but I do own two vehicles made by an American owned company.

[mycomment-2009]

Ha Ha europe is already the biggest economy in the world....Anything else for sale? Keep your sports nobody watches them outside the us anyway...Your done.
Posted by Bazzmcdyre at 06:26 AM : Jul 15, 2008

Big deal, we''ve seen all this before. Everybody worried about the Japanese taking over. They bought up a bunch of real estate and then lost their shirts in the 80s. Who wouldn''t sell their house or business if they were sucker enough to offer three times it value? America is still strong so don''t be fooled by a little economic turndown (as though Europe hasn''t had it share). It just galls you doesn''t it that America still holds the biggest influence around the world.

[bazzmcdyre]

Ha Ha europe is already the biggest economy in the world....Anything else for sale? Keep your sports nobody watches them outside the us anyway...Your done.

[carlylaine]

We are being taken over by foreign business. It''s encouraged by greedy-a$$ed stockholders. I hope you guys loose your money and won''t be able to live in those big expensive homes and have your grand vacations. I will never drink BUDWEISER ever again. YA POOTS!

[j_flood]

Just remember - the AB board agreed to a sale of the company - no hostile foreign company beating the company down. Just a simple tale of the free market has occurred.

[daysrnumbrd]

Two words:

MICRO BREWS!

Keep your money local, and the local economy working!

(and they just taste better anyway).

[whitemale08]

Sell Outs!

Thanks for thinking about the American Worker.

You guys are no different then South American Fascists like Carlos Andres Perez of Venezuela who privatized PDVSA Venezuela''s only source of income.

Thank Goodness Chavez came into power and reversed that nonsense.

You guys have no loyalty and you were the last hope to raise wages in this already hyper-inflationary environment.

You think some foreign company is going to give a da** about our wages? huh?

Come on man! just take your money and move to Dubai like the rest of your Wall Street buddies!!!

I can''t believe this !

[whiskyrocker]

I''ll never drink another "BUD" as long as I live. I''ll just stick with the Whiskey.

I bailed on Budswill years ago. If you want a real lager try Sam Adams'' Boston Lager. Best in the land.

[edintex]

I have 3 Bud lights left in the refridgerator. After that 3rd one, I will NEVER buy any Bud product (there are many of them we all know) ever again. I did the same with cigarettes, so I know I can do it with Bud.
I think I will look at purchasing some stock in Samuel Adams! They are gonna do well becuse of this MISTAKE Budweiser is making.

[whiskyrocker]

I''ll never drink another "BUD" as long as I live.

[Michael Arnold]

So much for their All-American image! Ha-ha!

They''re bailing out of a sinking US Ship. Who can blame them? Getting what they can and bailing.

[davidlar2]

Have you seen the CNN website? I wish the media would stop trying to fan the flames over this non-issue.

1. We should be happy that we live in a free dynamic capitalist country where this is allowed to happen. That is more American than Budweiser. Unfortunately, both the Republicans (especially the past 8 years) and the Democrats are erroding our freedoms, economic and other.

2. There are much more important issues to the average American than the passports of the people who own Budweiser. Inflation is out of control and the Federal Reserve may lower interest rates further to bail out some more banks. The federal government is spending money like a drunken sailor. Perhaps these are the things we should be talking about. They effect your bottom line in ways that the owner of Budweiser does not. Further, if we get our finances in order, this will strengthen the dollar giving Americans more purchasing power and Belgians relatively less....

[omja]

I, a Belgian beer drinker, say Inbev has nothing to do with brewing beer, it''s just a bunch of international profit sharks, after taking over Belgian breweries like Jupiler, Belle-Vue, Hoegaarden and Leffe, since 2002 beer prices increased about 80% in Belgium, consuming dropped, people got sacked and beer quality decreased. I hope Belgian beer never tastes like Bud, I rather drink lemonade, but I hope for all Americans Buds original taste will be preserved(for those who love it) as well as the jobs in the breweries.

[ratchow1962]

Given that she was created and gifted to us by the French and therefore is already an import.

Posted by toldyouso12

I knew she was a gift from France in 1886

The United States fought in 2 world wars to keep her freedom to prevent a foreign take over.How sad it is now that without firing a single shot,the world is slowly taking over the US.The Founding Fathers of your great nation would just be so sick at heart to witness this happening to a nation they risked their lives and their fourtunes to found in 1776. I only hope the US will survive to see her 300th Birthday
in 2076