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What a merger would meanAnheuser-Busch InBev would be the world's largest brewerConsumer products: Combining the brewers would create the world's third-largest consumer-products company with a market capitalization of about $114 billion. That's behind only Procter & Gamble Co. and Nestle SA, InBev says. Lots of suds: The new company would produce an estimated 460 million hectoliters (about 10.8 billion 12-packs) of beer annually and have annual sales of about $42.4 billion, which would put it ahead of competitor SABMiller. Goal: InBev's strategy is to increase sales of Budweiser and Bud Light in overseas markets where the beers are niche products. InBev CEO Carlos Brito, who would head the new company, says Budweiser will become a global product along the lines of Coca-Cola or Pepsi. SOURCE: InBev SA
Diverse divisionsAnheuser-Busch has interests in theme parks, malt production, rice milling, real estate development, turf farming, metalized and paper-label printing, bottle production and transportation. InBev SA's purchase calls for the sale of unnamed "noncore assets" to raise some of the financing for the deal. Here are some of Anheuser-Busch's divisions:Busch Entertainment Corp.: Operates 10 theme parks, including Busch Gardens Europe in Williamsburg; Busch Gardens Africa in Tampa, Fla.; Water Country USA in Williamsburg; and SeaWorld (in Orlando, Fla.; San Diego; and San Antonio) Busch Properties Inc.: Operates resort, residential and commercial properties including Kingsmill Resort & Spa in Williamsburg. Metal Container Corp.: Supplies more than 60 percent of Anheuser-Busch's U.S. beer cans and 75 percent of its domestic lids. Produces cans and lids for major U.S. soft drink companies including PepsiCo and Coca-Cola. Anheuser-Busch Recycling Corp.: Operates one of the world's largest recyclers of aluminum beverage containers. Eagle Packaging Inc.: Supplies liner material for the crowns and closures used in its beer packaging. Longhorn Glass Corp.: Supplies bottles to the Anheuser-Busch brewery in Houston. Manufacturers Railway Co.: Provides terminal rail-switching services to south St. Louis industries and operates a fleet of insulated beverage railcars and grain hopper cars. Anheuser-Busch Agricultural: Produces and enhances the quality of raw materials for the company's beers. St. Louis Refrigerated Car Co.: Manages rail/truck transload operation and other properties in St. Louis. SOURCE: Anheuser-Busch Cos. |
The dethroning of America's King of Beers may bring about a reordering of its kingdom.
The announcement of Anheuser-Busch Cos.' takeover by a giant Belgian brewer came with plans to sell unidentified "noncore assets" to raise $7 billion to help finance the $52 billion purchase. That is raising questions over the fate of its Virginia properties, including the Busch Gardens Europe theme park, the Water Country USA water park and Kingsmill Resort & Spa, all near Williamsburg.
Nina Devlin, a spokeswoman for buyer InBev, said the company is evaluating which businesses fall into that category. She added that InBev recognizes the important role the properties play in their communities.
"The brewery's going to stay," said James City County Administrator Sandy Wanner, because "beer-making is what InBev does." The plant is one of 12 North American breweries in Anheuser-Busch's stable. InBev said it will keep all of them open.
But Wanner wondered about the other properties that provide jobs and are an economic engine for the Williamsburg area's tourism industry.
"I'm not sure [InBev] runs theme parks and resorts and subdivisions. I assume that these properties have value to somebody," but if not InBev, "who steps up to take them over?"
While saying he feels like he's on the sidelines to any plans, Wanner said he hopes that if any decisions are made about the properties other than the brewery that "we get invited to at least be at the table to give our commentary."
Anheuser-Busch has been an asset to the community, he said.
The brewery, parks and resort employ slightly more than 5,000 people in the summer season and slightly less than 3,000 the rest of the year, said William F. Mezger, chief economist with the Virginia Employment Commission.
Anheuser-Busch announced yesterday that it has agreed to be bought by InBev. The deal, which is subject to shareholders' and regulators' approval, would create the world's largest brewer.
Wanner said Anheuser-Busch's Virginia properties are "a huge economic engine for us."
He said the $6.74 million in taxes paid for the properties, excluding the water park in York County, make up more than 6 percent of James City's annual collections. He added that the majority of the county's roughly $6 million annual revenue in meals tax also comes from Busch Gardens.
A report by Themed Entertainment Association and Economic Research Associates said attendance rose at Busch Gardens 12.5 percent in 2007 -- the largest percentage increase in the nation -- with about 3.12 million visitors last year.
Kingsmill features the 425-room Kingsmill Resort & Spa, as well as an upscale planned community along the James River with a golf course where the LPGA makes an Anheuser-Busch-sponsored tour stop each May.
Water Country USA, in neighboring York, features more than 30 water slides and attractions.
"[The properties] are extremely valuable assets to Virginia's quality of life and to our tourism," said Hugh Keogh, president and chief executive of the Virginia Chamber of Commerce.
The tourism dollars are so much of a boon for the area that the Williamsburg City Council passed a resolution last week praising Anheuser-Busch for the positive role it plays in the community and calling on the federal government to scrutinize any takeover closely.
Keogh said he believes the attractions will remain, but there may be a change in ownership.
"They are too attractive and too valuable to be just spun off or ignored," Keogh said. "But there will be some period of uncertainty, and I'm sure that will affect the employees' mind-set and peace of mind a lot in the next few months."
Anheuser-Busch, which traces its roots to 1860, also has influence throughout the St. Louis region -- from its name on the home of the St. Louis Cardinals baseball team to company-sponsored community events to charities that benefit from millions in corporate largesse each year.
"We know Anheuser-Busch," St. Louis Mayor Francis Slay said. "The concern is, we don't really know InBev."
InBev expects to find savings of $1.5 billion a year, and Anheuser-Busch already has announced plans to shed 1,185 positions -- mostly by offering early retirement and not filling open jobs.
Anheuser-Busch shares yesterday rose 37 cents to $66.87, shy of the $70-a-share offer.
Staff writers Holly Prestidge and Emily C. Dooley and The Associated Press contributed to this report.
