Bye-bye (almost) to A-B

[UPDATE 2008.11.18: SOLD]

It's a story that began in 1860 with the insurrection of German (and Irish) workers in St. Louis breweries against the forces of the pro-slavery Missouri governor.

It's a story of a beverage brand that —as well as Coca-Cola— has become a liquid surrogate around the world for the brand of American itself.

And, it's a story that will end later this year, when Anheuser-Busch, the last surviving independent large American brewery, will be sold to InBev, a Brazilian/Belgian conglomerate.

Yes, there are other American breweries that, like A-B, began their operations in the 19th century and that survive today. And we salute them.

But none remotely approaches the scale of operations of Anheuser-Busch, which produces 48.5% of all beer sold in the US, as well as its overseas large operations.

From the Anheuser-Busch Companies,Inc. press webpage:

ST. LOUIS (Nov. 12, 2008) – Anheuser-Busch Cos. Inc. (NYSE: BUD) today announced that a majority of its shares have been voted to approve the proposed combination between InBev N.V./S.A. and Anheuser-Busch during a special shareholder meeting held today [at the Crowne Plaza Meadowlands hotel in Secaucus, N.J.].

At the closing of the transaction, Anheuser-Busch shareholders will be entitled to receive $70 in cash for each share of outstanding Anheuser-Busch stock, and Anheuser-Busch will become a wholly owned subsidiary of InBev. Closing of the transaction remains subject to necessary regulatory approvals and other customary closing conditions. A closing date has not been announced, but the parties continue to expect the deal to close before the end of the year. InBev shareholders approved the combination on Sept. 29.

The good:

... over the past 150 or years, it's been a great employer and provided millions of people and their families with good jobs. It's also been a good citizen in the St. Louis area, donating what is now probably hundreds of millions of dollars to various charitable groups, a tradition that began with Adolphus Busch back in the 1870s. It practiced affirmative action before it had to and hired women before it was required to do so.

The Reality Of Mergers And Acquisitions
Maureen Ogle
November 10, 2008

The bad:

My one quibble with A-B’s statement today — there’s always something, right — is Busch’s comment that “[t]he merger also provides a promising future for our beer brands and for all stakeholders — employees, wholesalers, retailers and our consumers.” Maybe, but it certainly does not do so equally or evenly. Many of the employees who will be laid off might not feel that their futures have been made better by the merger. Likewise, distributor shakeups will inevitably take place, which I’m skeptical will be for the better. As for how it affects consumers, only time will tell.

InBev Merger Approved By A-B Shareholders
Brookston Beer Bulletin
November 12, 2008

And, the (not so) skinny:

InBev will be paying $52 billion at $70 a share. A-B's stock was trading at $66.54 per share yesterday.

Once the deal closes, Anheuser-Busch InBev (ABIB) will be the world's largest brewer, as determined by both volume and dollar sales of about $36 billion. Or will that now be listed in euros or reals?

As has been reported here, there remains an outside possibility that InBev may not be able to secure the financing to complete the deal.