Budweiser: The Great Belgian Lager

It’s official: Anheuser-Busch agreed on Sunday night to sell itself to the Belgian brewer InBev — The makers of brands such as of Stella Artois, Bass and Brahma — for $70/share, or about $52 billion; putting control of the nation’s largest beer maker and a fixture of American culture into the hands (and wallets) of a European rival.

The New York Times reports that,

The combined company is expected to be named Anheuser-Busch InBev, fulfilling a promise by the Belgian company to include the Anheuser name in the new brewer’s title, people briefed on the matter said. Anheuser will be given two seats on the board, including one for August A. Busch IV, the company’s chief executive and a scion of its controlling family.

But what is in store for “InBusch”? Job cuts are expected and they’ll happen hard and fast. According to a story in the Saint Louis Post-Dispatch,

In a conference call this morning, victorious executives from InBev laid out their plans to expand cost-cutting already underway at Anheuser-Busch Cos., and to build the world’s dominant brewer around its new flagship brand: Budweiser.

That cost-cutting plan — known as “Blue Ocean” — entails budget cuts totaling upwards of $1 billion in expenses over two years, which will be expanded to a $1.5 billion effort over three.

The most interesting tidbit, in my opinion, stemming from the whole buy-out was pointed out earlier by Jay Brooks,

Once the merger of the two companies is finalized, Anheuser-Busch InBev, will be a Belgian company. [Second largest American brewery] MillerCoors consists of MolsonCoors, managed from Canada, and [third largest American brewery] SABMiller, which is either a South African or London-based company, depending on your point of view. That leaves Pabst, the fourth largest beermaker by volume, but they do not own a brewery, instead contracting to have all their beer made at Miller’s breweries. So in terms of actual brewers (that is companies that own and operate a brewery) and who are U.S. owned, the biggest one remaining will be Boston Beer, making Samuel Adams as the undisputed biggest American brewer. Way to go, Jim. It also means Yuengling, America’s oldest brewery, becomes number two and Sierra Nevada comes in third. Amazing, simply amazing!

While it’s tough to see such an American icon crumble (even if you’re not a fan of their beers), the situation is made much sweeter knowing that Jim Kock is the new King of American Beers. Cheers, Jim!