Markets, Strategies, and Rivalries
New Horizons in International Business series
Edited by Jens Gammelgaard and Christoph Dörrenbächer
Chapter 10: The demise of Anheuser-Busch: arrogance, hubris and strategic weakness in the face of intense internationalization
Anheuser-Busch (A-B) began operations in 1852 in St Louis, Missouri (as the Bavarian Brewery) and has held the position of industry leader in the US since 1957. It has been run, but not controlled, by the Busch family since its founding. Despite wielding considerable influence and being able to appoint family members to the chief executive officer (CEO) position, the Busch family nonetheless owned only 4 per cent of the company’s stock and in that respect ultimately lacked authority and the requisite control that could have allowed them to counter the moves that subsequently undermined their ‘rule’. By the time the company was taken over in 2008, following a year of on-and-off negotiations, it was ultimately the A-B board that finally agreed to an offer of $70 a share from In-Bev SA/ NV and it was submitted for shareholder approval which subsequently came at the end of the year. The acquisition cost In-Bev $53 bn (€33 bn) and gave them prime position in the world’s most profitable beer market but also marked the end of A-B’s 150 years of independence. The events that precipitated this takeover surprised many, but for others it was the inevitable nail in the coffin of inefficiency, arrogance and the failure to react to an emerging global marketplace when domestic beer sales were declining.
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