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Saturday, November 21, 
11:13 am

Is Buffett behind Anheuser-Bev?

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anheiser.pngCould Warren Buffett play a role in InBev NV's rumored $46 billion deal with Anheuser-Busch Cos.? Alan Thomas, a senior manager at Deloitte Consulting LLP, thinks so.

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Buffett owns a 5% stake in the American brewer; the Busch family owns 4%; and Buffet has been instrumental in large deals before involving American iconic brands, explains Thomas.

"He had a deal with the Wrigley and Mars family in putting that deal together and that was an American icon brand. This is a company that has been underperforming and could be open to this kind of an acquisition," Thomas said. "Berkshire Hathaway will have a say in the way it happens."

Since Anheuser-Busch is an American iconic brand, Thomas even suggested that if the acquisition took place InBev may keep the Anheuser-Busch name or at the least change the name to Anheuser-Bev because Anheuser-Busch is an established brand with over 150 years of history whereas InBev has only four years of history.

"It would perhaps satisfy people. During its merger of AmBev, [InterBrew] strategically combined the names," Thomas said. Plus, from InBev's perspective if they were to acquire Anheuser, it would benefit them to distribute their existing products through an established brand name. - Maria Woehr





Comments

From: AB Employee,

I hope Mr Buffet is not suportive of a InBev deal. I don't think he is that short sighted. I am a long time management employee of Anheuser-Busch. I am commenting as a individual employee not as a company spokesperson. The comments that we are not capable of aggressive cost cutting is simply not true. We have been aggressively cutting costs and continue to meet or exceed our goals. We are now on track to cut costs at a comparable level that has been mentioned as a target for INBEV if they should succeed in their AB takeover attempt. We have introduced more new products than our competitors and they are taking hold in the marketplace. We run the most efficient technologically advanced breweries in the world. We do all of this while maintaining a superior product quality that our competitors can’t meet. Why would we want to sell a classic American Company to a foreign company when we are on track to accomplish all they would do and more. Yes it is true AB was sleeping while others were on a buying spree. If you look at the history of AB you will notice AB generally gets off to a slow start then overtakes all competition. The light beer category is a good example. We started out behind but now lead in sales of light beers. INBEV has built an empire by purchasing, then chopping heads off. History shows this style of management fails in the long run. The only way INBEV could save more money would be to cut advertising, burn out human resources and reduce product quality.
These are frustrating times for us. With the dollar down we are not in a good bargaining position. We believe strongly that our management style is superior and yields long term loyalty that pays dividends many years into the future. If InBev is successful and completes a hostile takeover they will need to terminate most if not all management at Anheuser-Busch. I for one believe strongly in the time tested and proven management style that we employ. I can’t see myself adopting the selfish and short sighted InBev style. I know I am not alone, wonder how they will run the complex Anheuser-Busch organization with a hostile management team. My guess is they can’t and would attempt to placate individuals for at least a year, then chop heads. This indeed would be a clash of the titans, is that good for the stock holders? I don’t think so.


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