Deutsche Bank AG responded to the news by downgrading Anheuser to “hold” from “buy” at, saying the stock price has been driven by press reports of the possible deal.“We have concerns that such a high price requires aggressive cost reduction and risks harming brands, distribution and execution,” analysts Marc Greenberg and Andrew Kieley wrote in a research note dated May 26. “These are not positive changes, but simply what’s necessary to feed an ever-hungry global deal machine.”
The Wall Street Journal reported today that InBev was considering the deal and that while CEO August A. Busch IV and his father August A. Busch III were opposed to the deal, others in the family thought it was worth considering. While the Busch family has guided the company for 150 years, it now controls less than 4 percent of its shares.
- Kansas City Star
We know according to the article where Busch III and Busch IV stand, but who if any, are the other family members that agree with them? Disagree? More importantly, where do the majority share holders stand?
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go ahead share your thoughts with me now.
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Kevin: I work for Anheuser-Busch here in St. Louis - I am a contractor here on a 5 year contract that is 8 months old. This time last year the same rumors were circulating. However, I do believe that this time they have more credit to them.
ReplyDeleteThe following is my opinion of what I am seeing.
As an insider, I know this is the "buzz" around the office. Busch III and Busch IV are adamant about not letting go of the company - but the both of them own only about 1% stock. Warren Buffet, on the other hand, owns almost 5%.
It has been Buffet's tactic for a long time to buy shares up in an undervalued company - a company whose debt load, market presence, and strength do not reflect the share prices - the prices are seen by him as too low.
Then, he helps foreign investors secure financing - as he is doing with InBev now in their hostile takeover of AB, and then walks away with a ton of cash. In this particular instance with AB, he will walk away with an excess of $60 million dollars, plus the amount he earns on the financing.
So, is Buffet now a most admired person? Does he sell out, for money, the people, the culture of his own country? The answer is YES.
The devaluation of the dollar thanks to the Fed has also made American companies look more attractive to people who want to do hostile takeovers.
InBev didn't get the response they wanted from the Busch family. I doubt they will get a favorable response from the Board of Directors. If they don't get a favorable response from the Board, they will go for a simple minority vote from the stock-holders.
We will see if the stockholders sell out or not. If they do, it will indeed be a sad day.
The stockholders out there that I've talked to and seen their comments on the internet show a strong favoritism to telling InBev to stick it where the sun doesn't shine.
There will be about 12K jobs lost in St. Louis, where I live. I will be first on the chopping block because I am a contractor.
It's a good thing I am debt free except the house, and have 14 MONTHS of living expenses in my emergency fund, or me and my daughter (I am a single parent) would be on the streets.