InBev Seeks To Kick Out Anheuser’s Board

BRUSSELS, Belgium (AP) -- Brewer InBev turned up the heat in its hostile, $46 billion bid for Anheuser-Busch, announcing Monday that it will attempt to remove the company's entire board.

An alternate board, which would include Adolphus Busch IV, the uncle of Anheuser CEO August Busch IV, will give shareholders "a direct voice" in the takeover, InBev said.

InBev plans to file a preliminary consent solicitation with the U.S. Securities and Exchange Commission Monday, asking Anheuser's board to consult shareholders over the firing of 13 current board members.

Shareholders have the right to sue Anheuser's board if they feel the directors are not acting in their best interest. A majority of shareholders would need to back InBev's plan.

The Belgian-based maker of Stella Artois wants Anheuser to respond within 10 days.

InBev SA said it was taking action because Anheuser has refused to talk about its offer.

Carlos Brito, InBev's chief executive, said he strongly prefers to negotiate with Anheuser on InBev's $65 a share offer, which was well above the company's $50 per-share price before market speculation about the offer drove the U.S. brewer's share price to $61.67.

Anheuser shares rose 9 cents to $61.76 in midday trading Monday. Inbev shares rose less than 1 percent to 41.73 euros ($65.40).

Anheuser-Busch Cos. Inc. rejected the bid two weeks ago, saying it undervalued the company. It put forward its own plan for earnings growth that would cut costs and increase prices to boost share prices over the next few years.

Brito again criticized the plan, saying it had "significant execution risks" because it did not tackle the problems Anheuser will face in a competitive industry as prices for transportation and key ingredients soar.

In addition to Adolphus Busch IV, the alternate board would include former Guidant CEO Ronald Dollens; former Nabisco CFO James Healey; ex-Pillsbury CEO John Lilly; ex-Glaxo CEO Ernest Mario; and former Lockheed Martin chief counsel William Vinson.

"They are committed to acting in the best interests of Anheuser-Busch shareholders and will take an independent view on the proposed combination," InBev said.

The combined company would be the world's largest brewer by far. Based in Belgium, InBev now pulls most of its profits outside of the stagnant beer-drinking markets of North America and Europe, focusing instead on emerging economies in Latin America, Asia, eastern Europe and Russia.

But the company's aggressive cost-cutting has unsettled some in the United States.

Several politicians have come out against the deal, saying it may create a near-monopoly in the U.S. beer market and damage the economy in the company's home state of Missouri by shedding some of the 6,000 workers the company employs in St. Louis.

InBev has promised not to shut any U.S. breweries and to keep the company's North American headquarters in St. Louis.

The beer industry has been consolidating in recent years amid rising costs for transportation fuel and key ingredients.

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Viewing 13 User Comments	Add a Comment
Bud 7/7/2008 12:25:00 PM The stock holders invest to get a profit on their stock. Sounds like they got one. AB should have had these cost efficiency improvements on line before now. I drink Coors anyway.
Bully 7/7/2008 12:35:00 PM InBev looks like they want the Budweiser Co. even if they have to bully everyone for it. If the Board and people don’t want another off shore Co. to take over they should have the right to reject them.
No More Consolidation 7/7/2008 12:40:00 PM After already losing Miller and many other smaller brewers, more consolidation is not a good thing. But more basically, when will people see that conslidation of huge companies is a sign of mutual weakness, not strength! Finally, this offer is also the fruit of running the value of the dollar into the ground for the last several years, There will be more foreign acquisition attempts while the dollar is this low.
Philanthropies funded by AB 7/7/2008 1:22:00 PM The other still unanswered question is what happens to all the philanthropies funded by AB such as HUB and the AB Conservation Fund that protect the environment. I can not picture InBev which is all about the profit funding even SeaWorld and Busch Gardens to the levels to compete with Disney and Universal like the Busch's. And they probably will completely cut the philanthropies funded by AB.
AB acquisition 7/7/2008 1:57:00 PM I hate the bully mentality. Our school tolerate zero bullying, why does our government not do the same. InBev, get the message and go home! Don't call us, we'll call you. We don't want you or need you! Get the message? What are you going to do when the shareholders tell you to go fly a kite? Threaten to take their first born?
The Selling of America 7/7/2008 2:22:00 PM It sounds like AB has cornered the Hops market and InBev would like access. Wait, do you really want a Bud to cost as much as a Stela. Any time a European company has taken control of a US brand the cost of the goods rises at the consumers expense. It sounds like August Busch has finally had enough and if he stands firm the share price of AB will end well above the InBev offer showing that it was indeed a undervalued stock. The smart investor would have purchased a block at $50/share and sent Carlos Brito a Thank You card.
Selling Out the US 7/7/2008 2:34:00 PM Again, this is just another example of selling out the US. Send more profits overseas. Why not, we're already subsidizing the economic growth of the rest of the developing world instead of reinvesting in our own country.
InBev Seeks To Kick Out Anheuser’s Board 7/7/2008 3:18:00 PM This whole proposal by InBev looks like a hostile takeover of the U.S. company Anheuser and has the potential to move production of U.S. beer out of the U.S. I have witness this pattern before, first hand. This should be avoided at all cost! More and more companies are moving manufacturing out of the U.S. and forcing U.S. comsumer market to inport consumer goods. This will end in foreign contries owning the U.S. and who ever owns us will run us and our millitary forces. We have seen the begining with oil and our dependance on foreign oil. Next will be beer, then wine, food, etc. Manufacturing has to return back to the U.S. and our foreign imports need to decline. This is a threat to the American way of life!
learn from the poison arrow frog 7/7/2008 3:27:00 PM The doctrine of greed and out of control "free" trade has permeated high levels of our government, and even a very good corporate citizen like AB gets no protection from hostile foreign aggression. If the world is truly reduced to economic Darwinism, may be AB should learn from nature and make itself too deadly to be swallowed. Free trade is not free if it is not just and fair, just look at the slave trade of yesteryear.
Stop Foreign Monopolies 7/7/2008 5:01:00 PM Do any of us really believe there is much true economic justice left in our country? We need to enforce the anti-monopoly laws in our country against foreign Monopoly of our industries just as the Chinese/Japanese and European do today. Otherwise, I agree its the end for us as a great Nation.
AB Sale 7/8/2008 12:54:00 AM I've been a AB shareholder for 20+ years and MillerCoors is my personal largest account. I believe the potential of INBEV to take over AB is a larger issue. This reflects the erosion of America as we know it. Why keep selling off America one piece at a time. Why not have AB acquire INBEV?
Hold your ground AB!! 7/8/2008 8:37:00 AM It sounds like InBev has the same problem GE has - GREED. Their only concern is the Stock Price, not the well being of their highly valued employees. Employees they freeze from transferring out of a company they intend to sell. InBev will do exactly the same thing to the AB employees. Investing is great, but when it goes to your head and consumes you, is it worth the cost?
InBev vs AB 7/8/2008 8:57:00 AM Being from the St. Louis area I have grown up with AB and watched their work in the community for my entire life. Augie was a man interested not only in his families business but he knew the importance of taking care of where he lived and who lived around him. He understood that a company is only as good as the people that work for it. From the top CEO to the cleaning crew he treated everyone with respect. He valued his community. Why if the board does not want to sell can InBev force them through legal manipulation into selling? THIS IS JUST WRONG!

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