Striving for a Better Trade: InBev acquires Anheuser-Busch
Is it a better trade for consumers when the largest brewer in America is
purchased by a company based in Belgium? People who drink Budweiser or any of
the Anheuser-Busch products probably haven't noticed a difference, which
could be a sign of a better trade.
InBev was created in 2004 through the merger of Belgium-based Interbrew and
Brazilian-based AmBev. Interbrew can trace its history back to 1366 with the
founding of the Artois brewery. Interbrew became an international player in
1987 with the purchase of Canadian brewer Labatt. AmBev claimed a dominant
position in the South American market after it was formed from a merger
between Brahma and Antarctica breweries, a better trade for both companies.
Anheuser began as a small brewery in St. Louis in 1852. Adolphus Busch was the
first U.S. brewer to use pasteurization to keep beer fresh, the first to use
artificial refrigeration, the first to use refrigerated railroad cars, and
the first to extensively use bottles. It became the largest brewer in the
United States in 1957 and produces about 11 billion bottles of beer each year.
In June 2008, InBev made an offer to buy Anheuser-Busch for $46 billion and a
month later a settlement was reached for $52 billion in cash or $70 per share.
After further negotiations, InBev was renamed Anheuser-Busch InBev.
So, was this a better trade?
For the InBev people it was a good deal. They further expanded their
territory in North America and established the brand name of its other
important brews like Stella Artois, Beck's, Tennents, Boddingtons,
Staropramen, and Bass. InBev now has operations in 30 countries and sales in
130 countries, and is now the world's largest brewer, surpassing London-based
SABMiller.
It was also a better trade for the Anheuser-Busch people. The merger
strengthened the financial footing of the company in America and enabled the
brewery to fly through the current economic crisis with little worry. Part of
the agreement was that no American breweries would be closed and that
management would retain the same flavor. Even better for Anheuser-Busch was
the ability to change the name of the corporation that gives the American
brewer top billing.
Anheuser-Busch continues to operate and maintain 10 theme parks across the
United States. These are part of the Busch Entertainment Corporation and
include Busch Gardens in Tampa and Williamsburg, Va., SeaWorld in Orlando,
San Antonio and San Diego, and Sesame Place in Pennsylvania. Another park is
planned to open in Dubai, with movement expected once economic conditions
improve. Most of these entertainment facilities offer reduced rates, with
many printing and distributing discount coupons, which makes it a better
trade for visitors.
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