'Nightly News' Attacks Budweiser/InBev Merger
It wasn’t unexpected to see some pushback after a deal was struck merging American brewer Anheuser-Busch with European brewer InBev.
However, the July 14 “NBC Nightly News” didn’t identify much that was positive about the deal – including the dramatic increase in the company’s stock upon the news. Instead, NBC’s report was downbeat and insinuated the worst was coming.
“It’s become a pretty constant drumbeat lately – foreign companies and funds taking advantage of the weak U.S. dollar and buying big American assets,” “Nightly News” anchor Brian Williams said. “Last week, you’ll recall it was the government of Abu Dhabi buying the Chrysler Building here in New York. Well, tonight beer drinkers around the country are saying, ‘Say it ain’t so.’ The all-American beer maker Anheuser-Busch – Budweiser – said it’s being taken over by a big Belgian rival.”
Cohn made the deal out as a huge negative for St. Louis residents.
“They might be crying in their beer here, except it’s not exactly their beer anymore,” CNBC correspondent Scott Cohn said. “[M]ore than just a company in St. Louis, Anheuser-Busch has been here since before the Civil War.”
“We’re losing our beer, y’know, our company,” said one St. Louis woman, though Cohn said the company is not leaving St. Louis, which will remain its North American headquarters.
And shareholders of Anheuser-Busch will benefit. InBev is not getting the American brewer cheap, according to Bloomberg.
“At $70 a share, InBev is paying about 11 times Anheuser's 2009 projected earnings before interest, taxes, depreciation and amortization, based on analysts’ estimates compiled by Bloomberg,” Duane D. Stanford wrote for Bloomberg on July 14.
Early in March, Anheuser-Busch shares were trading at $45.72. Now that news of the deal is official, shares closed at $66.87 on July 14 – approaching a 50-percent increase. Even though the new owner has promised to keep the sacred Clydesdale horses, Cohn said now that InBev owns the company, the Clydesdales are just “another corporate mascot.”
“For now the new owners are promising to preserve American jobs and they promise to keep the famous Budweiser Clydesdales – a local symbol in St. Louis, but soon just another corporate mascot,” Cohn said.
The deal faced opposition from the left – including Democratic Sens. Claire McCaskill (Mo.), presumptive Democratic presidential nominee Sen. Barack Obama (Ill.) and the Teamsters union. The Teamsters launched a Web site – Budwatch.org – complete with anti-InBev protectionist language criticizing the deal.
“While shareholders will see a healthy profit (with A-B stock already rising on the news), employees, retirees, and the communities that depend on Anheuser-Busch face questions about the future of the company,” the Web site said.
Cohn echoed that somber tone as he wrapped up his report, saying, “at this point, Brian, there is little anyone can do to stop this deal.”