Proposed merger of Anheuser-Busch and InBev

The proposed merger of Anheuser-Busch and InBev would, if approved by shareholders and regulators; create Anheuser-Busch InBev, the world's largest brewer and fourth largest consumer product company, [ [http://www.iht.com/articles/ap/2008/07/14/business/EU-Belgium-InBev-Anheuser-Busch.php InBev says it will acquire Anheuser-Busch for $52 billion - International Herald Tribune ] ] with leading positions in the world's top five markets - China, U.S., Russia, Brazil and Germany. Its key brands are Beck's and Stella Artois with Budweiser serving as the newly formed company's flagship brand. [http://www.globalbeerleader.com/home.php] Currently, both companies remain optimistic that the deal will finalize. The U.S. Justice Department has also asked InBev for more information regarding the proposed merger.

Anheuser-Busch

Anheuser-Busch Companies, Inc. operates the largest brewing company in the United States in volume with a 48.8% share of beer sales. It is the world's largest brewing company based on revenue, but third in brewing volume, before the proposed merger with InBev announced July 13, 2008. The company operates 12 breweries in the United States and nearly 20 others overseas.

Anheuser-Busch Companies, Inc. (ABC) is the holding company of Anheuser-Busch, Incorporated (ABI), a beer brewer. The Company is also the parent corporation to a number of subsidiaries that conduct various other business operations. ABC's operations comprise four segments: domestic beer, international beer, packaging, and entertainment, which contributed 75%, 7%, 10% and 8%, respectively, of the ABC's net sales, during the year ended December 31, 2007. Approximately 93% of the ABC's net sales are generated in the United States. Worldwide sales of the Company's beer brands aggregated 128.4 million barrels in 2007, which comprises domestic and international volume. International volume represents Anheuser-Busch brands produced overseas by company-owned breweries, under license and contract brewing agreements, plus exports from the Company's United States breweries.

Anheuser-Busch's best known beers include brands such as Budweiser, the Busch (originally known as Busch Bavarian Beer) and Michelob families, and Natural Light and Ice. The company also produces a number of smaller-volume and specialty beers, nonalcoholic brews, malt liquors (King Cobra and the Hurricane family), and flavored malt beverages (e.g. the Bacardi Silver family and Tequiza).

On July 13, 2008, Anheuser-Busch and InBev announced that they have completed a deal at $70 per share, which will create a new company to be named Anheuser-Busch InBev. Anheuser-Busch will get two seats on the combined 14 board of directors. The all-cash agreement, almost $52 billion in total equity, will create the world’s largest brewer, uniting the maker of Budweiser and Michelob with the producer of Stella Artois, Bass and Brahma. The two companies would have yearly sales of more than $36.4 billion and replacing the current No. 1 brewer (measured currently by volume), SABMiller in London. [http://www.nytimes.com/2008/07/14/business/worldbusiness/14beer.html?ref=europe nytimes.com, Anheuser-Busch Agrees to Be Sold to InBev] ] [http://www.marketwatch.com/news/story/anheuser-busch-accepts-70-share-52-billion/story.aspx?guid=%7B02125469-49F4-4C21-824D-01EB0623A817%7D&dist=hplatest marketwatch.com, Anheuser-Busch accepts $52 billion InBev offer] ]

InBev

InBev is the second largest brewery company in the world. [ [http://news.bbc.co.uk/1/hi/business/7417392.stm Bid talk boosts Budweiser maker] . "BBC News". 2008-05-23.] While its core business is beer, the company also has a strong presence in the soft drink market in Latin America. It employs about 86,000 people and is headquartered in Leuven, Belgium.

InBev was created in 2004 when the Belgian company Interbrew and the Brazilian company AmBev merged, creating the world's largest brewer. [ ]

InBev has operations in over 30 countries and sales in over 130 countries. [http://www.inbev.com/press_releases/20050330.1.e.cfm] In 2006 it had a market capitalisation of €30.6 billion and net profit of €3.2 billion on sales of €13.3 billion (£10.61 billion).

On Sunday, July 13, 2008, InBev agreed to buy Anheuser-Busch which will create a new company to be named Anheuser-Busch InBev. It was reported that Anheuser will get two seats on the combined board of directors. [ [http://online.wsj.com/article/SB121598077288249131.html?mod=hpp_us_whats_news InBev Buys Anheuser-Busch for $49.91B] ] The deal has yet to be approved by appropriate regulatory agencies.

The all-cash agreement, for $70 per share, or almost $52 billion in total equity, will create the world’s largest brewer, uniting the maker of Budweiser and Michelob with the producer of Stella Artois, Bass and Brahma. The two companies would have yearly sales of more than $36.4 billion, surpassing the current number one brewer, London SABMiller.

Corporate governance

Brazilian Carlos Brito is the current chief executive officer. Brito replaced John Brock at the end of 2005. [ ] InBev's current Board of Directors include Allan Chapin, Carlos Alberto da Veiga Sicupira, Arnoud de Pret Roose de Calesberg, Jean-Luc Dehaene, Philippe de Spoelberch, Jorge Paulo Lemann, Roberto Moses Thompson Motta, Kees J. Storm, and Peter Harf (chairman of the Board).

InBev was created in 2004 from the merger of the Belgian company Interbrew and the Brazilian company AmBev. [ [http://www.beveragedaily.com/news/ng.asp?id=50355-interbrew-buys-ambev Interbrew buys AmBev and becomes world number one ] ] Before the merger with Ambev, Interbrew was the third largest brewing company in the world by volume, Anheuser-Busch was the largest, followed by SABMiller in second place. Heineken International was in fourth place and AmBev was the world's fifth largest brewer.

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