U.S., Czech Beer Makers Brew Up A Deal

Czech brewery Budejovicky Budvar NP and U.S. beer giant Anheuser-Busch Cos Inc., who have been fighting a century-long legal battle, said Monday they have "formed a historic alliance" to import Budvar's beer to the United States.

According to a statement by the two rivals, Anheuser-Busch "will become the U.S. importer of Czechvar." Budvar has exported its lager to the U.S. under the name Czechvar since 2001.

"The agreement gives Czechvar, currently sold in 30 states, access to Anheuser-Busch's marketing and sales expertise and wide-reaching U.S. distribution network." the statement said.

"After years of differences, this is a meaningful step for two great brewers to form a relationship that is good for both of our businesses," said August A. Busch IV, president and chief executive of Anheuser-Busch Cos. Inc.

"For Anheuser-Busch, it also represents an opportunity to enhance our import portfolio with a super-premium Czech import," he said.

Anheuser-Busch added Czechvar to Beck's, Bass and Stella Artois and other beers on its import portfolio, the statement said, giving the Czech beer "access to the Anheuser-Busch network of nearly 600 independent wholesalers."

The U.S. company said imported beer is one of the fastest-growing segments of the U.S. beer industry, which grew seven percent in 2005.

Jiri Bocek, director general of Budvar, called the deal "a historical turning point between our companies. We managed to move away from discussions between lawyers and towards a practical dialogue," he said.

The Czech brewer expected a significant growth of Czechvar sales in the United States due to the agreement, Budvar spokesman Petr Samec said. He said Budvar exported 241,800 gallons of Czechvar to the United States in 2006.

Budvar exports its production to 50 countries worldwide.

The agreement, that became affective Jan 5, "does not impact existing litigation or trademark disputes between the two companies in other countries," it said.

Anheuser-Busch — the largest brewer in the United States — has been battling with Budejovicky Budvar for the exclusive rights to the Budweiser name and others — such as Budvar — for over a century. Currently, they are involved in some 40 lawsuits worldwide.

Budejovicky Budvar was founded in 1895 in Ceske Budejovice — called Budweis by the German-speaking people that populated the area at the time. Beer has been brewed there since 1265.

The founders of Anheuser-Busch used the name Budweiser for their product because it was well-known in their German homeland. The St. Louis brewery got its start in 1852. It began producing Budweiser, America's first national beer brand, in 1876.