It's over, folks: Buffett backs Budweiser sale - Top Stocks Blog - MSN Money
 
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It's over, folks: Buffett backs Budweiser sale

Posted Jun 17 2008, 01:30 PM by Anthony Mirhaydari
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In a surprising move, Warren Buffett told the Belgian newspaper De Standard this morning that he supports InBev's $46 billion cash offer for Budweiser brewer Anheuser-Busch. His Berkshire Hathaway owns some 35 million shares, or a 5% stake in the iconic beer maker.

The endorsement comes as a bit of a slap in the face for Anheuser CEO August Busch IV, who was trying to buy some time as indicated in this formal response sent to InBev yesterday. In fact, the Oracle of Omaha was going to grace Mr. Busch with his presence later this week to talk the deal through.

Anheuser-Busch shares rose 1.1% to $61.20 today and are up 34% since mid-March as takeover speculation has grown.

Could Mr. Buffett be positioning himself as the vanguard for a shareholder coup? No doubt many would like to avoid the Yahoo debacle we all just witnessed. And he recently demonstrated his deal closing abilities as a critical part of the Mars acquisition of Wrigley's. Other shareholders will likely be influenced. After all, who wouldn't want to stand shoulder-to-shoulder in a deal with the world's richest man?

The opposition seems decidedly less impressive. Certainly, popular support continues to rally in St. Louis, where the local community is trumpeting its opinion with a chorus of "Hell no, Bud won't go." But in reality, things look bleak. Recent changes to Anheuser's corporate governance policy weaken its anti-takeover defenses. Moreover, the history of August Busch IV doesn’t exactly impart confidence; instead, it reminds me of the blighted past of one George W. Bush.

Speaking of politics, Missouri Governor Roy Blunt, a vehement opponent of the deal, is the wildcard. He has already asked the Federal Trade Commission to review the deal, saying that he is "concerned that this sale would have destabilizing impacts on our nation and state's long-term economic interests."

When it comes down to it, American's just don’t like the idea of foreigners buying our stuff, as Barron's outlined in this excellent piece over the weekend. InBev CEO Carlos Brito was in Washington D.C. today trying to placate some of these feelings. I hope he brought along a few bottles of Beck's and Stella Artois -- he'll need them.

I'll have more on Anheuser's strategic alternatives in a post later this week.

Previous posts:

Will Budweiser become Belgian?

The sinfully bullish case for Anheuser-Busch

(Disclosure: I don't own any shares of the companies mentioned.)

Comments

 

I'm a Bud drinker and I'm going to switch to an American made  and owned beer.  I've been drinking Bud for almost 50 years, but I'll switch .  (MADE IN THE USA)

miller beer< union made>

America here is where we can take a stand and make a point at the same time. Let this carlos clown buy the Brewery an than we all stop drinking the beer . Just think how long he would last at that rate. Then we can get together an buy him out. How about that deal beer lovers.

A-B only holds at most 20% interest in the company.   Grupo Modelo holds 50%.  A-B hasn't owned its own company in many years. Why the big to do about this now is beyond me.  Uncle Augie sold out long ago. Get a grip, everything in our country is imported or owned by over sea investors anyway. Hell it's part of the American dream. Create a product then sell it off for a profit, nobody in this country wants to work. The only people whinning are the over paid broom pushing employees who may have to find a job with out the good ole boy system.

Of course he approves of the deal. 1. This is what HE DOES. He buys and sells companies with addictive products. i.e. - coca-cola, chewing gum, BEER. 2. He stands to make a serious profit if in-bev, Coors, or the South African gov't wants to buy Bud. Monetarily, there's nothing wrong with the deal. Idealogy - wise, crushing. Warren is just looking out for Warren. What has he done lately - since 2001- NOTHING. Everyone hits the bulls eye once in their life, man did he ever hit the bulls eye though.

German Beer, American Beer, all the Money in the world wouldn't buy it if it was mone.  I still buy American cars, American products(if you can find them) and American beer. If they sell stop drinking the stuff, see Mr. Smart Buffet make a million on beer nobody will buy.

I remember the "Big Sell Off" of the 80's when Asia acquired much of America.  I understand the tough time all Americans are having, I am one of them, BUT I think it's time we put an end to the bleeding and stop the transfer of business to other countries.  I think it's time we take SOCIAL RESPONSIBILITY as consumers, stock holders, and business owners and keep our dollars here and help to rebuild our own economy.

As an aside, I don't know how the oil company bosses cna sleep now that they and the futures traders have plunged our economy into a recession.  I fear the sell off of America's iconic businesses will further lead to the DEPRESSION (both economic and psychological ) of America.

Americas largest brewer and our railroads going into foreign hands, isn't about time we stand up and send a message to Washington? What is going to be left in the US nothing but our reliance on other contries. We all must let our politicians know how we feel in November.

Hopefully they will turn Bud into a better tasting beer.

It's such a shame to see this happening to an American company.  Corporate America is so caught up in their own greed, they are more worried about shareholder prices than people losing jobs and americans not being able to "buy american".  Warren Buffet should be ashamed of himself for not being more supportive of this staple in American culture.  America's heading for the worst...

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