241 Pizza

In response, Anheuser-Busch has beefed up its craft-beer business. It has also tried to tap into foreign markets through a 50% stake in Modelo, the Mexican brewer of Corona, as well as an investment in China’s Tsingtao Brewery. Still analysts argue that compared with InBev and SAB Miller, Anheuser-Busch has not been nearly as aggressive in expanding internationally. InBev, by contrast, is huge in Europe, Brazil and China, but a small force in America.

“Anheuser’s strengths are in its premium brands, and those are out of favour. They have done some great things with craft beers. But little deals like that don’t move the needle,” Schumacher said. Against this background other US beer executives believe a bid for Anheuser is not a matter of if but when. “Beer is a scale business. The footprint of AB and InBev are very complementary. I’d put it at 75% likely that something will happen in the next three months,” a brewery executive said.

If a deal is to be done, there is more than the Busch family to convince. Budweiser is a national icon. In St Louis, home to Anheuser headquarters, the Busches are like a royal family. Their name adorns the Cardinals baseball stadium.

Foreign ownership is a hot topic in America, especially in an election year. InBev is a Belgian-based firm run by Brazilians with a reputation for vicious cost-cutting. Last week an analyst described them as “machete-wielding investment bankers”.

The political heat is already rising before any bid is made. The Teamsters Union represents 7,500 of Anheuser’s 30,000 employees and has spoken out against foreign ownership. Talk of redundancies in an election year could make a Budweiser bid a hot political item. When, and if, a bid comes, the Busches, like other founding families, may find they face an uphill struggle.

Speculative shareholders have piled into the stock on more than year-long rumours about a deal and would be likely to throw their weight behind a takeover.

Buffett’s Berkshire Hathaway investment company owns a 5% stake in Anheuser. Buffett has a habit of siding with management and is a long-term investor but knows a good deal when he sees one. Ominously for the Busches, he helped to finance the Mars takeover of Wrigley.

At $65 a share, InBev’s offer would be at a substantial premium to the $58 high that Anheuser shares hit on news of the potential bid. As InBev’s bid builds a head, the signs are not good for the founding family.

“All the big brewing firms are built on family takeovers,” said an executive. “InBev know what they are doing. If anyone knows how to squeeze a family out of a business, it’s the brewers.”

Two brewers

Anheuser-Busch:
HQ: St Louis, Missouri
Market value: $40.3bn (£20.3bn)
Sales: $16.6bn
Profits: $2.1bn
Employees: 30,849
Brands: 100 brands, principally Budweiser and Michelob, and 12 US breweries producing 128m barrels a year. Around 93% of sales are generated in the US.

InBev:
HQ: Leuven, Belgium
Market value: €29.5bn ($45.8bn)
Sales: €14.4bn
Profits: €2.2bn
Employees: 89,000
Brands: 200 brands, including Stella Artois, Beck’s, Hoegaarden, Leffe, Brahma and Staropramen, in 20 markets mainly outside the US.

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