thedrifter
06-25-08, 07:32 AM
BUSINESS WORLD
By HOLMAN W. JENKINS, JR.
This Bud's For Sale
June 25, 2008; Page A13
Editor's note: At press time, the authenticity of this leaked entry, purportedly from the diary of Anheuser-Busch CEO August A. Busch IV, could not be confirmed:
Dear Budweiser-branded Desk Diary: How many times have you heard a story like this one? A troop of investment bankers from New York shows up at the offices of some Old World company with a not-so-friendly takeover at an insultingly rich price. They say: You want to control your destiny? You should have grown the business and its profits in line with potential. You didn't. Now get outta here.
In Germany they call this "Anglo-Saxon" capitalism – and not in a nice way. Well, Anglo-Saxon capitalism has come to St. Louis. And the target is me!
Omigod. Just when I was starting to get my hands around the job. Here I am, the sixth of my lineage to run the company, and yes the stock had been flat and sales of Budweiser have been falling. What did you expect? Fifty-percent market share doesn't last forever. I read someplace there's now three dozen subgenres of heavy metal, where once it was all just rock 'n' roll. But even against the microbrews and the new-agey drinks, we managed to build Bud Light into a megabrand. It's now our biggest and still growing.
Anyhow, I'm not the one who decided we shouldn't join the rush overseas or expand our brand portfolio faster. I've been playing catch-up. We struck a deal to distribute Stella Artois, Beck's and InBev's other premium brands here (I guess they figured out our real asset is our distribution system, bigger than Pepsi's or Coke's). And we use InBev to push Bud in South Korea and Canada. Yet see how my "partner" repays me? InBev throws a bunch of money in my face and wants to take my company away.
OK, I probably went along with the corporate governance guff to make my promotion to the top job easier for our public shareholders to swallow (nepotism – ugh, I hate that word). We got rid of the poison pill. We made it easier for shareholders to call a special meeting. We got rid of staggered elections for directors. Big mistake. Now it complicates our ability to adopt the "just say no" defense.
But it wasn't my idea, all those years ago, to go public and run the family's voting share down to 4.5%. We should've been smart like our amigos at Grupo Modelo. They sold us 50.2% of their Mexican company and somehow managed to keep control. They beat our brains out with our own money pushing Corona in our markets. Now some around here want to overpay for the rest of Modelo to scare off InBev. But Modelo calls the shots, not us. Unbelievable.
Of course, the press thinks I'm just some jerk. They keep writing how I crashed my Corvette in college and killed a girl. Worst moment of my life and the media will never forgive me – for having a Corvette in college. But I'm crafty. Living down my reputation as a playboy punk, I'm now supposed to fight like a banshee to preserve the family heritage so I can continue to run it and redeem myself in daddy's eyes. That's their story. I can make it work for me. The lawyers say we don't have a leg to stand on to reject $65 a share. They say if InBev raises its bid to $70, we'll have to fold like an aluminum empty. So my new legacy will be . . . $75 a share!
Never mind the doofy family members. Uncle A. says he's for the deal, "shareholders rights" and all that. My other Uncle A. is against it. Dad is . . . Dad. But I'm getting all the support I need from politicians. I've got Gov. Blunt and Sen. McCaskill playing the fool for me, mau-mauing the deal on patriotic grounds, etc. These pols are smart – don't let anyone tell you different. Of course there's no basis in antitrust or (guffaw) "national security" for Washington to get involved and block the deal – if we want to be taken seriously as a country. But no matter how it ends, the pols can't lose. At worst, they help me run up the price on the Brazilian-Belgians (Belgilians?). You can never go wrong as a pol giving the local billionaires a reason to be grateful.
Then there's Warren. Old Warren. Unsourced reports in the overseas press say he supports InBev, but Warren supports maximizing Warren's dollars. Why would he speak up and take the heat off InBev now?
More worrisome, admittedly, is a certain segment of our public. But they'll get over it. Next day, the sun will come up. There will still be Clydesdales and Super Bowl ads. We never should have let Dale Earnhardt Jr. go, but we'll survive InBev. Right now, some Americans are starting to sound like Germans (in their attitude toward capitalism, not their taste in beer, thank God). But they'll wake up tomorrow without even a hangover. They love their Bud and always will.
Ellie
By HOLMAN W. JENKINS, JR.
This Bud's For Sale
June 25, 2008; Page A13
Editor's note: At press time, the authenticity of this leaked entry, purportedly from the diary of Anheuser-Busch CEO August A. Busch IV, could not be confirmed:
Dear Budweiser-branded Desk Diary: How many times have you heard a story like this one? A troop of investment bankers from New York shows up at the offices of some Old World company with a not-so-friendly takeover at an insultingly rich price. They say: You want to control your destiny? You should have grown the business and its profits in line with potential. You didn't. Now get outta here.
In Germany they call this "Anglo-Saxon" capitalism – and not in a nice way. Well, Anglo-Saxon capitalism has come to St. Louis. And the target is me!
Omigod. Just when I was starting to get my hands around the job. Here I am, the sixth of my lineage to run the company, and yes the stock had been flat and sales of Budweiser have been falling. What did you expect? Fifty-percent market share doesn't last forever. I read someplace there's now three dozen subgenres of heavy metal, where once it was all just rock 'n' roll. But even against the microbrews and the new-agey drinks, we managed to build Bud Light into a megabrand. It's now our biggest and still growing.
Anyhow, I'm not the one who decided we shouldn't join the rush overseas or expand our brand portfolio faster. I've been playing catch-up. We struck a deal to distribute Stella Artois, Beck's and InBev's other premium brands here (I guess they figured out our real asset is our distribution system, bigger than Pepsi's or Coke's). And we use InBev to push Bud in South Korea and Canada. Yet see how my "partner" repays me? InBev throws a bunch of money in my face and wants to take my company away.
OK, I probably went along with the corporate governance guff to make my promotion to the top job easier for our public shareholders to swallow (nepotism – ugh, I hate that word). We got rid of the poison pill. We made it easier for shareholders to call a special meeting. We got rid of staggered elections for directors. Big mistake. Now it complicates our ability to adopt the "just say no" defense.
But it wasn't my idea, all those years ago, to go public and run the family's voting share down to 4.5%. We should've been smart like our amigos at Grupo Modelo. They sold us 50.2% of their Mexican company and somehow managed to keep control. They beat our brains out with our own money pushing Corona in our markets. Now some around here want to overpay for the rest of Modelo to scare off InBev. But Modelo calls the shots, not us. Unbelievable.
Of course, the press thinks I'm just some jerk. They keep writing how I crashed my Corvette in college and killed a girl. Worst moment of my life and the media will never forgive me – for having a Corvette in college. But I'm crafty. Living down my reputation as a playboy punk, I'm now supposed to fight like a banshee to preserve the family heritage so I can continue to run it and redeem myself in daddy's eyes. That's their story. I can make it work for me. The lawyers say we don't have a leg to stand on to reject $65 a share. They say if InBev raises its bid to $70, we'll have to fold like an aluminum empty. So my new legacy will be . . . $75 a share!
Never mind the doofy family members. Uncle A. says he's for the deal, "shareholders rights" and all that. My other Uncle A. is against it. Dad is . . . Dad. But I'm getting all the support I need from politicians. I've got Gov. Blunt and Sen. McCaskill playing the fool for me, mau-mauing the deal on patriotic grounds, etc. These pols are smart – don't let anyone tell you different. Of course there's no basis in antitrust or (guffaw) "national security" for Washington to get involved and block the deal – if we want to be taken seriously as a country. But no matter how it ends, the pols can't lose. At worst, they help me run up the price on the Brazilian-Belgians (Belgilians?). You can never go wrong as a pol giving the local billionaires a reason to be grateful.
Then there's Warren. Old Warren. Unsourced reports in the overseas press say he supports InBev, but Warren supports maximizing Warren's dollars. Why would he speak up and take the heat off InBev now?
More worrisome, admittedly, is a certain segment of our public. But they'll get over it. Next day, the sun will come up. There will still be Clydesdales and Super Bowl ads. We never should have let Dale Earnhardt Jr. go, but we'll survive InBev. Right now, some Americans are starting to sound like Germans (in their attitude toward capitalism, not their taste in beer, thank God). But they'll wake up tomorrow without even a hangover. They love their Bud and always will.
Ellie