All sorts of good stuff in this story., or rather this meta-story.
Way back in November 2001, several European-centered news organizations, including Reuters, The Financial Times, and the Guardian, received under unclear circumstances what appeared to be a presentation originally prepared in connection with a planned corporate acquisition. The leak, if trustworthy, was important: Interbrew, a large Belgian-based beer company, (best known for Stella Artois and Beck's) was about to launch a bid to buy SAB, the South Africa based rival best known for Carling Black Label. And it was prepared to pay up to 650p per share for SAB, but it was going to try a low-ball bid of 500p first.
Some of the news organizations ran the story. They didn't say the bid would happen, but they did say they had received documents claiming, etc. On Nov. 29, 2001, for example, the Guardian published a story saying that it had a “secret document” which it said had been couriered to a “large chunk” of the business press. The price of SAB rose, of course, and my guess is that the leaker then sold his shares of it for a nice quick profit.
The truth behind these documents seems to be that they were real, but that the price and had been tampered with. (The actual price range contemplated in the real documents had been 400-550, not 500 - 650. The leaker presumably changed the numbers to create a higher price bounce.) Interbrew decided it would not go forward with the proposed bid. And it was furious at the unknown leaker, so it sued the media outlets and demanded to know where they had gotten this material.
Don't cry for Interbrew. They later became Inbev, and still later took over Anheuser-Busch. Anyway, back to 2001...the outlets resisted, Interbrew filed a lawsuit in the UK, and over the course of the following years, the case wound its way up to the European Court of Human Rights.
Possibly important point: NONE OF THE MEDIA OUTLETS INVOLVED had ever promised confidentiality to the leaker. Yet they resisted giving up information about their receipt of the tampered-with documents because they believed doing so would hurt their ability to make such promises when it was warranted.
December 15, 2009: ECHR has ruled in favor of the news outlets. "Interbrew's interests in eliminating, by proceedings against X, the threat of damage through future dissemination of confidential information and in obtaining damages for past breaches of confidence were, even if considered cumulatively, insufficient to outweigh the public interest in the protection of journalists' sources."
Comments, anyone? (And yes, Mr. Rather, you may go to the airline ticket counter immediately if you like.)
Showing posts with label InBev. Show all posts
Showing posts with label InBev. Show all posts
Wednesday, December 16, 2009
Monday, October 20, 2008
A 'beer war' after all?
InBev, the Brussels based company that has entered into an agreement to buy Anheuser-Busch, faces a rebellion at last -- coming from a perhaps-unexpected quarter, from Grupo Modelo and allies.
InBev and AB agreed on the terms of their combination in July. Shareholders of the target company are to get a sizeable premium over the price of their stock before the bid, and Budweiser (not Stella Artois) will be the flagship brand of the combined company.
The key fact for understanding the new development is this: AB owns half of the equity in a Mexican beer company, Grupo Modelo, best known for Corona.
GM has initiated an arbitration action against AB, claiming that the latter was obligated under a 1993 agreement to consult it before concluding a deal with InBev. The arbitration action has instigated rumors that what GM really wants is a chance to buy back that 50% share of its equity. But a spokeswoman for the Mexican company denied this to a reporter for Reuters Friday.
InBev has a statement out expressing confidence "that the claims made by Modelo [and related parties] are entirely without merit."
Anyway, if Grupo isn't seeking the opportunity to buy back AB's interest: what does it want? To throw a monkey wrench in the works of the still-unclosed deal entirely? To get a greenmail pay-out for the shareholders who own the other half of its equity? What?
The price of Grupo shares was flat Friday on the Mexican stock exchange. The price of AB shares rose slightly.
InBev and AB agreed on the terms of their combination in July. Shareholders of the target company are to get a sizeable premium over the price of their stock before the bid, and Budweiser (not Stella Artois) will be the flagship brand of the combined company.
The key fact for understanding the new development is this: AB owns half of the equity in a Mexican beer company, Grupo Modelo, best known for Corona.
GM has initiated an arbitration action against AB, claiming that the latter was obligated under a 1993 agreement to consult it before concluding a deal with InBev. The arbitration action has instigated rumors that what GM really wants is a chance to buy back that 50% share of its equity. But a spokeswoman for the Mexican company denied this to a reporter for Reuters Friday.
InBev has a statement out expressing confidence "that the claims made by Modelo [and related parties] are entirely without merit."
Anyway, if Grupo isn't seeking the opportunity to buy back AB's interest: what does it want? To throw a monkey wrench in the works of the still-unclosed deal entirely? To get a greenmail pay-out for the shareholders who own the other half of its equity? What?
The price of Grupo shares was flat Friday on the Mexican stock exchange. The price of AB shares rose slightly.
Tuesday, July 15, 2008
Beer brawl never really got going
They've wrapped it up. InBev and Anheuser-Busch have agreed on the terms of their combination. Shareholders of the target company will get a sizeable premium over the price of their stock before the bid, and Budweiser (not Stella Artois) will be the flagship brand of the combined company.
And that lawsuit filed last week? the one that invoked US policy toward Cuba? It hasn't been withdrawn, and no responsive pleading has yet been filed, but I gather it'll be allowed to wither on the vine.
Some family history. Judging from utterly unreliable comments on blogs, and deserving of all the credibility that sourcing suggests: the Busches are descended from Bavarians and Hessians. Anheuser is itself apparently a brewing town in what used to be Bavaria. There is also an Anheuser family, which joined the Busch's by marriage a couple of generations back.
InBev also gets to inherit an intellectual property dispute, because Busch ancestors got their start in brewing as frank imitators of an already well-known beer, and their "King of Beers" is a usurper.
Pivovar Budejovicky Budvar has the legal rights to market its beer under the "Budweiser" brand name in much of Europe, but it sells it in the rest of the world under variants such as "Budvar" and "Czechvar" to avoid legal squabbles with Anheuser-Busch.
Anheuser-Busch has made offers to buy the Czeck brewing company out but this has been repulsed. Keeping the Budweiser name Czech has become a matter of national pride. Perhaps it is more prideful to stand up to Americans than it would be to stand up to Belgians, so some deal will be cut in the near future as a consequence of this consolidation.
But really ... who cares? I wanted to see a fight over the merger and a proxy fight over that first fight! Waaaaah.
And that lawsuit filed last week? the one that invoked US policy toward Cuba? It hasn't been withdrawn, and no responsive pleading has yet been filed, but I gather it'll be allowed to wither on the vine.
Some family history. Judging from utterly unreliable comments on blogs, and deserving of all the credibility that sourcing suggests: the Busches are descended from Bavarians and Hessians. Anheuser is itself apparently a brewing town in what used to be Bavaria. There is also an Anheuser family, which joined the Busch's by marriage a couple of generations back.
InBev also gets to inherit an intellectual property dispute, because Busch ancestors got their start in brewing as frank imitators of an already well-known beer, and their "King of Beers" is a usurper.
Pivovar Budejovicky Budvar has the legal rights to market its beer under the "Budweiser" brand name in much of Europe, but it sells it in the rest of the world under variants such as "Budvar" and "Czechvar" to avoid legal squabbles with Anheuser-Busch.
Anheuser-Busch has made offers to buy the Czeck brewing company out but this has been repulsed. Keeping the Budweiser name Czech has become a matter of national pride. Perhaps it is more prideful to stand up to Americans than it would be to stand up to Belgians, so some deal will be cut in the near future as a consequence of this consolidation.
But really ... who cares? I wanted to see a fight over the merger and a proxy fight over that first fight! Waaaaah.
Wednesday, July 9, 2008
The Clydesdales Hire Lawyers
Anheuser-Busch has filed a lawsuit (as of Monday) in the federal district court in St Louis. MO seeking to preserve its independence from the Eurolopers at InBev.
One unusual twist is thatA-B wants to use the US embargo of Cuba as a justification for keeping InBev away. The euros have substantial operations in Cuba, and of course AB isn't allowed to transact business there. Ths, even if the two companies are formally merged they'd have to remain operationally distinct.
To make this a subject for a lawsuit, rather than simpky a "don't sell" pitch to shareholders, A-B has to say that this is material information that InBev is hiding in its efforts to acquire control of A-B at a price that doesn't match the economic realities of the situation.
That is, accordingly, what the complaint does.
InBen "claims it will make St. Louis the North American headquarters for the combined company, a promise it has repeated on numerous occasions since making its unsolicited acquisition offer...."
InBev's North American operations include its Cuban business. So InBev is being less-than-honest with the above cited promise.
An obvious riposts suggests itself. Surely, when the company is combined, the Cuban operations can be shifted (geography notwithstanding) to the European HQ of the resulting behemoth. The bulk of the North American operations would be, roughly, what A-B is now. That was the point of the promise, wasn't it? Not "we'll give you Missourians control of our N.A. operations" but "we'll let you keep control of yours."
Anyway, everything is given a national-security angle nowadays, and we can expect to see more of this.
One unusual twist is thatA-B wants to use the US embargo of Cuba as a justification for keeping InBev away. The euros have substantial operations in Cuba, and of course AB isn't allowed to transact business there. Ths, even if the two companies are formally merged they'd have to remain operationally distinct.
To make this a subject for a lawsuit, rather than simpky a "don't sell" pitch to shareholders, A-B has to say that this is material information that InBev is hiding in its efforts to acquire control of A-B at a price that doesn't match the economic realities of the situation.
That is, accordingly, what the complaint does.
InBen "claims it will make St. Louis the North American headquarters for the combined company, a promise it has repeated on numerous occasions since making its unsolicited acquisition offer...."
InBev's North American operations include its Cuban business. So InBev is being less-than-honest with the above cited promise.
An obvious riposts suggests itself. Surely, when the company is combined, the Cuban operations can be shifted (geography notwithstanding) to the European HQ of the resulting behemoth. The bulk of the North American operations would be, roughly, what A-B is now. That was the point of the promise, wasn't it? Not "we'll give you Missourians control of our N.A. operations" but "we'll let you keep control of yours."
Anyway, everything is given a national-security angle nowadays, and we can expect to see more of this.
Sunday, June 15, 2008
Three brief items
1. Biogen Idec Gets Some Support
Carl Icahn is waging a classic dissidents' campaign for three seats of the board of Biogen Idec, a biopharmaceutical concern.
Biogen is a Nasdaq-listed company HQed in Cambridge, Mass. Cambridge, moreover, is where the annual meeting will be held, this coming Thursday.
In recent days, the major proxy-advisory concerns have generally lined upin support of the incumbent board, though.
Riskmetrics: "The dissident has not met its burden of proving that board change is warranted at Biogen. Abesent a showing that the incumbent board has failed in some fashion, we find it difficult to support the removal of directors."
Glass Lewis: "In our opinion the current board and executives have created substantial value for shareholders and we believe that the Company has solid growth opportunities as a stand-alone entity."
2. Clumsy France Telecom ultimatum
Meanwhile overseas. On June 5, France Telecom rather brusquely informed a Swedish company, TeliaSonera, that they'd better commence "friendly" talks with regard to a takeover. Or else. The "or else what" part was left unspoken.
But the statement was sufficiently undiplomatic to create a backlash, and the Financial Times is reporting that there is a risk of "the type of nationalist backlash that scuppered Renault's attempts to buy Volvo in the 1990s. So France Telecom has now sensibly decided on a more softly-softly approach."
Softly-softly or otherwise, TeliaSonera is so far unswayed.
3. Who will feed the Clydesdales?
This is likely not the first place you've heard this, or the twentieth, but: a Brazilian-Belgian beer company, InBev, wants to buy Anheuser-Busch. It's offering US$46 billion [30 billion euros).
There are obvious economies-of-scale considerations in the brewing business which are said to have created the recent wave of consolidation. The larger brewing companies can cut the better deals for raw materials, and can economize on the distribution network as well. But I have to wonder if that fully explains recent developments.
Another random point: We always see some Busch family scion on the television commercials (when they aren't showing us their beautiful horses). But I wonder ... how much of the company does the family still own? I'll have to look into that in the days ahead.
At any rate, here some further discussion.
Carl Icahn is waging a classic dissidents' campaign for three seats of the board of Biogen Idec, a biopharmaceutical concern.
Biogen is a Nasdaq-listed company HQed in Cambridge, Mass. Cambridge, moreover, is where the annual meeting will be held, this coming Thursday.
In recent days, the major proxy-advisory concerns have generally lined upin support of the incumbent board, though.
Riskmetrics: "The dissident has not met its burden of proving that board change is warranted at Biogen. Abesent a showing that the incumbent board has failed in some fashion, we find it difficult to support the removal of directors."
Glass Lewis: "In our opinion the current board and executives have created substantial value for shareholders and we believe that the Company has solid growth opportunities as a stand-alone entity."
2. Clumsy France Telecom ultimatum
Meanwhile overseas. On June 5, France Telecom rather brusquely informed a Swedish company, TeliaSonera, that they'd better commence "friendly" talks with regard to a takeover. Or else. The "or else what" part was left unspoken.
But the statement was sufficiently undiplomatic to create a backlash, and the Financial Times is reporting that there is a risk of "the type of nationalist backlash that scuppered Renault's attempts to buy Volvo in the 1990s. So France Telecom has now sensibly decided on a more softly-softly approach."
Softly-softly or otherwise, TeliaSonera is so far unswayed.
3. Who will feed the Clydesdales?
This is likely not the first place you've heard this, or the twentieth, but: a Brazilian-Belgian beer company, InBev, wants to buy Anheuser-Busch. It's offering US$46 billion [30 billion euros).
There are obvious economies-of-scale considerations in the brewing business which are said to have created the recent wave of consolidation. The larger brewing companies can cut the better deals for raw materials, and can economize on the distribution network as well. But I have to wonder if that fully explains recent developments.
Another random point: We always see some Busch family scion on the television commercials (when they aren't showing us their beautiful horses). But I wonder ... how much of the company does the family still own? I'll have to look into that in the days ahead.
At any rate, here some further discussion.
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