< Bud, an American Icon, Pursued by Belgian Firm

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Heard on All Things Considered

June 12, 2008 - MICHELE NORRIS, host:

From NPR News, this is ALL THINGS CONSIDERED. I'm Michele Norris.

MELISSA BLOCK, host:

And I'm Melissa Block.

Today, the CEO of the Brazilian Belgian brewing giant InBev described his company's offered to buy America's largest brewer, Anheuser-Busch. He called the match a perfect fit. But if the deal goes through, it would mean the end of an era for the American beer industry.

From member station KWMU is St. Louis, Adam Allington reports.

ADAM ALLINGTON: In the shadow of Busch Stadium, the staff of Patty O's is getting ready for the lunch crowd. If there's a place to have an ice-cold Bud, this is it.

Mr. JASON ARMBRUSTER (Bar Manager): Literally, our property butts up against Busch Stadium. And I'd say we average about 16 to 18,000 cases a year.

ALLINGTON: Jason Armbruster is the bar manager. He says his regulars aren't happy about the news that the maker of Budweiser might be acquired by a foreign firm. He says comparisons to the foreign buyout of Miller beer don't really apply.

Mr. ARMBRUSTER: Miller's been owned by a foreign company forever, but Anheuser-Busch kind of stands for America.

ALLINGTON: Throughout the '80s, '90s and up till now, Anheuser-Busch has emphasized Bud's red, white and blue pedigree. Remember those here's to you, America commercials?

InBev's CEO, Carlos Brito, says that mixture of branding and market savvy is a perfect fit for a world player like InBev. Brito laid out his plans for Anheuser-Busch to industry analysts on a conference call earlier today.

Mr. CARLOS BRITO (CEO, InBev): Budweiser is already one of the most recognized and beloved brands in the world. It is our intention to extend Budweiser even further, through our extensive distribution network.

ALLINGTON: InBev's reputation for slashing costs isn't a secret; it has many speculating that as many as 2,000 white and blue-collar jobs in St. Louis may be on the line. Don Volanski's worked in marketing at Anheuser-Busch for over 15 years.

Mr. DON VOLANSKI (Marketing, Anheuser-Busch): Certainly InBev is putting a positive spin on things, saying that this could be a great potential to increase Bud's global strength. But just with the reputation of InBev, their cost cutting, I think, has a lot of the employees concerned about how this might play out.

ALLINGTON: For the past five years, Anheuser-Busch's share price has been relatively stagnant, around $50 per share. InBev is offering $65 per share. Former Anheuser-Busch marketing executive Bill Finnie says with so much shareholder profit on the line, a merger might be a foregone conclusion. But that doesn't mean it will be easy to make it work.

Mr. BILL FINNIE (Former Marketing Executive, Anheuser-Busch): Done wrong, it's going to be a disaster for InBev, for Anheuser-Busch and its people, and for the St. Louis region. Done right, it can be a huge win for all three.

ALLINGTON: InBev has stated that it would make St. Louis its North American headquarters, which could go a long way toward solving its public relations concerns. Anheuser-Busch's board of directors has been quiet, saying only that it will pursue the course of action that's in the best interests of company shareholders.

For NPR News, I'm Adam Allington in St. Louis.

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