International Beer Company Acquisition: Producers of Stella Artois and Budweiser Join Forces

International Beer Company Acquisition: Stella Artois and Budweiser Join Forces
The Belgium-based company Inbev bought out the well-known United States beer company Anheuser-Busch (BUD) with a $52 billion dollar takeover of the company, with each share amassing a figure of over 70 dollars per share. On November 18, 2008, this international transaction enabled the now called Anheuser-Busch Inbev to acquire over 22% of the world market share in the beer industry, with SABMiller in second with a distant 13% share of the market (Figure 1). This company has almost 300 different brands with the major ones being Budweiser, Stella Artois, and Becks, which were the significant driving forces behind $36.76 billion dollars in revenue with a $4.613 billion dollars in profit in 2009. Anheuser-Busch Inbev’s geographic wingspan stretches over 30 countries with a total of approximately 116,000 employees. This NYSE publically traded company holds its headquarters in Leuven, Belgium with its executive offices in New York City, New York.

Figure 1. World Market Share of Beer Producers by Volume

Inbev was originally founded in 2004 when Ambev and Interbrew merged and in doing so they created the largest brewing company in the world. Of course up until 2008 when they bought all 100% of the St. Louis, Missouri-based company Anheuser-Bush’s shares. This acquisition just reaffirmed many economists beliefs that the beer industry was undergoing rapid globalization in the United States and the world for that matter. The implications and the magnitude of this acquisition have caused an increase in movement in the United States of the beer industry to be heading in the direction of an oligopoly. Many economists believe that the Inbev merger should be categorized as a conglomerate merger, meaning that prior to their takeover agreement both of these firms had little to no economic involvement or dealing with one another simply due to a sizeable amount of distance decay.



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http://www.marketwatch.com/story/anheuser-busch-accepts-52-billion