GETTING IN BED WITH INBEV, PART TWO

This is all starting to sound like a suspense novel. Now Washington is involved. InBev has hired a posse of lobbyists. Trent Lott is on board. So is Senator John Breaux of Louisiana. The Glover Park Group, a media firm known to be connected with Senator Clinton, has been tapped for consultation. Carlos Brito is taking no chances, well aware that Anheuser-Busch spent over $3 million in lobbying in 2007. This year their PAC and employees have already given over $1 million in political contributions. The foxes are scrambling to see who gets the big hen house, with all those prized eggs.
Senator Kit Bond had another take. He told Carlos Brito: “This Bud is not for you.”  The Missouri Senator has concerns he says, for the line workers, the farmers, the suppliers, and the St. Louis community in general. It does not matter who InBev hires, he is against the deal and that’s that.
But is it? What about the Oracle? What Oracle? Why the Oracle of Omaha of course. I’m talking about Big Daddy Warren G. Buffett, owner of 35.3 million shares of A-B stock, or 4.9% of the company. According to the Dutch newspaper De Standard, the Oracle is on board with the acquisition. If this is the case, having the Oracle’s blessing may very well mean the purchase will become a reality. 35.3 million shares at $65 a share. Go ahead, don’t be afraid of the math.
Yikes! All this monumental fuss over a very pedestrian beer. It is enough to drive you to drinking… water.

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GETTING IN BED WITH INBEV

The news announced: “an all cash takeover at $47 billion”, now that sum is reported to be $47.5 billion. I am speaking of course of the buyout of Anheuser-Busch (ticker symbol: BUD) by the Belgian based brewing conglomerate known as InBev.  According to Theresa Howard of USA Today, it just might be that InBev needs to bed A-B, more than vice versa. It is being reported that the hydra-headed brewing concern has squeezed all of the profit margins from their existing portfolio. Sales in Latin America, their biggest market, are now flat. The old adage, get bigger or get out, seems to apply here. InBev’s CEO, Carlos Brito reveals their desire by promising to keep A-B’s headquarters in Saint Louis, along with continuing operations in their 12 regional breweries.
But then, there is the whole matter of marketing, especially sports marketing. InBev known in big business circles for its cost cutting, will certainly change Budweiser’s advertising, what beverage industry analyst, Tom Pirko calls “Anheuser’s carpet-bombing approach”.
Anheuser-Busch, known for making The King Of Beers, is most certainly the king of advertising, spending $475 million in the United States, with $20 million going for TV spots on the Super Bowl. Contrast that with InBev, whose brands include Bass, Beck’s, Stella Artois, spent $58 million in the United States.
Many analysts believe that InBev will cut advertising expenditures and fight competition by cutting prices (so that’s why that 24 ounce Labatt’s costs one dollar!).
Of course there is much controversy in all of this. Objections to the purchase, on patriotic grounds seem disingenuous at best. Since 1852, Anheuser-Busch has been an American-owned and operated business. In addition to great tasting beer, the company has provided thousands of domestic jobs as well as millions of dollars in charitable donations to nonprofit organizations and disaster relief, and has a long history of environmental awareness. Anheuser-Busch is a huge supporter of our military and their families both here and abroad… so intones savebudweiser.com, a web site created to cancel the purchase. Throwing in the military line seems to imply that to be bought by the Belgium based company is somewhat an act of surrender. But what is truly suspect on savebudweiser.com, is when it declares, We don’t want another American icon turned over to a foreign company; we want the motto to remain… The Great American Lager. Funny they just happened to use the latest marketing motto to express their nationalistic fervor. Instead how about “A Bud Never Meets A Stranger” or “When You Say Budweiser, You Said It All” or “For All You Do, This Bud’s For You!”
Putting aside the emotional jingoism, consolidation has been going on in the beer industry for a long time. From a Pitt News editorial on May 24, 2006: Last Friday, Rolling Rock said goodbye to its home in Latrobe. The recipe and label of the green-bottled brew were purchased for $82 million by Anheuser-Busch. Which says nothing of Bud’s relationship with Japan’s Kirin Brewery. Throw in the marketing arrangements with Tsing Tao in China, and what we have here is an American based company with very global concerns.
And then, there are always those people who simply can not stand Buweiser, who couldn’t care less. I find their posts on beer sites: The man who drank 3 Buds at a wedding reception, which produced his first hangover in twenty years. The people who love the Bell’s Brewery, and that’s that. (Well, maybe not, Carlos Brito may one day make Larry Bell an offer he simply can not refuse.)
“Anheuser-Bush is just about as American as can be” said one construction manager, “I just don’t like them being gone and owned by a foreign company.”  I am sure the people of Latrobe, Pennsylvania felt likewise, when the 250 jobs and $300 thosand property taxes evaporated when Anheuser-Busch bought the brand and pulled up stakes… from the glass lined tanks of Newark, New Jersey?
Money does not talk, it screams. The possibility of $70 dollars a share (ticker symbol: BUD) may be impossible to resist.

THE SHOP IS OPEN

First off, it has been awhile since I have written anything on this, my favorite beloved web site. Recent distractions, such as the high cost of living due to the fossil fuel energy inflation, have taken their toll. Nevertheless, many things have happened.
The Fire At The F.X. Matt Brewery. Thursday night, a fire broke out at the brewery located in Utica, New York. I learned of this through e-mail from the company itself. This is a sad, though not dire, situation. I soon learned that their production facility was damaged, but not the brewed beer! I am going to purchase Saranac beer through the summer (at least) as tribute to the fine, decent business that the Matt Brewery is. I remind myself that not only do they produce their own great line of beers, but are also the contract brewers for the Brooklyn Brewery. Through their contractual work, many have enjoyed their handiwork, without even knowing their name. Blessings of the heart, they brew good beer.
What A Wonderful Beer. I am speaking of that conspiracy of goodness that has returned: Genesee Bock Beer. The arrival of this inexpensive, great tasting brew is just what the doctor ordered in these monetary challenging times. I have read comments from beer snobs who just could not understand why they enjoyed an affordable beer in a can. The gentle graphics of a young goat with flowers, green and yellow, should tell you that this is no ordinary beer. For lack of a better word, I call it: magic.
Sierra Nevada Southern Hemisphere Harvest Ale. From Chico, California comes this ale that is the epitome of the Sierra Nevada Brewery’s personality. Taking up where their fall classic, Harvest Ale, stops. Southern Hemisphere uses the fresh hops being harvested in New Zealand, which in turn, are quickly shipped from down under to California. Although expensive at five dollars per 24 ounce bottle, it is most definately worth the bother. Unlike the trend towards “extreme beers” , the empahsis here is on the tremendous flavors of the recipe. For those familar with Sierra Nevada, I will put it this way: sipping this ale, I had an almost Proustian moments of remembrance of Celebration Ales from the past. Easily one of the very best brews available in the United States.
Harpoon 100 Barrel Series: Old Rusty’s Red Rye Ale. From Boston, Massachusetts comes this amber colored pour with a very inviting, spicy nose. There is a drop dead iron-like palate. This is a rye ale that is exquisite in every degree. Truly something to behold. An incredible rye bread spicy finish, with a 6.5% abv, that says yes, it is all true. This is an iconoclast recipe for the ages. Pure example of what the best craft brewers strive for, challenging and deliciously unique.
Moylan’s Hopsickle Imperial Ale. From Novato, California, this bright orange-gold pour is luxuriously deep, even in a mug with handle. The intense citrus nose of foam makes this a kind of sherbet. The extended length of time it takes to settle, acts as a natural preventative from consuming too quickly, and at a too cold temperature.
As to the palate? This is indeed for the lupulin warriors. A combination of Chinook, Ahtanum, Columbus, Sincoe, and Cascade hops make this a tart bittersweet  experience, with a long, as in the day is long, finish. In what in the United States are called “extreme beers”, this “triple hoppy” Imperial IPA  would be an honored guest. A very strong presentation, equally matched in strength (9.2% abv). At one time, this would be considered adventurous, but after so many stabs by brewers at extreme beers, this might be considered par for the course.
So that is all for now. I will try not to be a stranger. My prayer is, as always, Thank You.