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And so the mind games have begun. After a week which saw InBev’s CEO Carlos Brito courting his opposite number at Anheuser-Busch – and seemingly at times the whole US beer drinking public – with assurances about protecting A-B’s heritage, there was a subtle change in tone this weekend. In an effort to up the pressure on A-B’s board, Brito has sent his opposite number August Busch IV a letter after press speculation emerged that A-B and Modelo were in talks about a possible merger in order to defend against InBev’s advances. The letter says: “In light of the reports, we believe it is important for you and your board to understand that our proposal to combine with Anheuser-Busch by means of acquiring all Anheuser-Busch outstanding shares for $65 per share in cash is made on the basis of Anheuser-Busch's current assets, business and capital structure.” It goes on: “It is our strong belief that no alternative transaction that you could effectuate would create more value for your shareholders than the $65 per share in cash that we are offering. We are convinced that your shareholders would reach the same conclusion.” Upon reading the letter you are struck by the blinding obviousness of it all. Surely there is nothing in there that August Busch doesn’t understand already about InBev’s intentions? But of course this letter isn’t designed for Busch or the A-B board. It is designed for A-B’s shareholders in an effort to prompt them to think hard about where best lie their interests and perhaps bring A-B to the negotiating table. The temptation in these cases is almost always to believe bigger must be better. But A-B has a pretty good track record in delivering shareholder growth and mergers don’t always work out for the best – just ask Trevor O’Hoy. The CEO of Foster’s Group stepped down last week. Our ‘In the spotlight’ feature asks where it all went wrong for the boss of this Australian giant. Of course, O’Hoy isn’t the only CEO under pressure at the moment, as the twin forces of costs pressures and a global slowdown continue to put pressure on companies across the industry. Coca-Cola Hellenic Bottling is the latest to suffer, hit by poor weather and rising oil prices. Until next time... Olly Wehring, Managing Editor Web: www.just-drinks.com
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Focus - Inbev's move for Anheuser-Busch [MEM] InBev's announcement late yesterday (11 June) that it has made an offer to acquire Anheuser-Busch comes as little surprise. Speculation of a tie-up between the brewers has surfaced over the last 18 months or so. But the amount offered – US$65 per share – certainly looks enticing to A-B's shareholders. So, it's a done deal, yes? Olly Wehring takes a closer look at the offer.
The Power 100 – the world’s most powerful spirits and wine brands This month's briefing is the 2008 edition of "The Power 100", published by leading consultancy Intangible Business, which looks at the key issues affecting the wines and spirits industry and identifies the brands which have performed well - and those that have experienced difficulties over the past year. This annual report, into the most powerful spirits and wine brands in the world, takes into account the consumer's perception of brand strength and its financial performance, using a robust methodology. A panel of leading international drinks experts are asked to score each brand on a variety of measures and these scores are combined with hard volume data to create a league table of the most powerful international drinks brands in the world.
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June 16, 2008 
