Busch slips off stage despite positioning for role in InBev spotlight
Nine months ago, a historic meeting was breaking up in the ballroom of a Secaucus, N.J., hotel. Anheuser-Busch shareholders had just agreed to sell America’s biggest brewer to an aggressive Belgian brewer called InBev.
August A. Busch IV, whose stint as chief executive of Anheuser-Busch would end with the sale, stepped down from the podium. "A bittersweet day," he said.
And then, Busch — the fifth generation of his family to lead Anheuser-Busch — slipped out of the hotel’s lobby.
But he wasn’t supposed to slip out of the public’s eye.
The new regime had given him a seat on the board of the combined company and a lucrative consulting deal — indications that he would be a sort of public ambassador for the new Anheuser-Busch InBev. Many expected him to ease Anheuser-Busch’s transition to new ownership, and act as a liaison between the new owners and A-B’s many constituencies.
It hasn’t worked out that way.
Since the buyout, Busch has not been spotted at industry events. No quotes in media reports, no pictures at meet-and-greets. From trade meetings to sales conferences with distributors, Busch has been a no-show.
"He has not been visible in the beer industry," said Harry Schuhmacher, editor of Beer Business Daily. "I just haven’t heard of him being around."
The disappearance seems odd given how much InBev paid for Busch’s services. As part of the buyout, InBev made him a highly paid consultant for Carlos Brito, CEO of the combined company.
Busch, 45, received $10.35 million as a lump sum and started collecting additional fees of about $120,000 a month. He also got a personal security detail and free access to events sponsored by A-B.
The official merger document seemed to outline a clear role for him at Anheuser-Busch InBev. At Brito’s request, Busch would advise InBev on new products; review marketing programs; meet with retailers, wholesalers, advertisers and the media; scrutinize the quality of Anheuser-Busch’s beers; and give advice about A-B’s relationship with charitable organizations and local communities.
"He was supposed to represent continuity from one era to the next, but I don’t know if he’s played much of a role" in the combined company, said Benj Steinman, editor of Beer Marketer’s Insights.
The lucrative consulting deal also tied Busch and InBev to a mutual "non-disparagement" covenant, limiting what Busch could say about InBev and what InBev could say about him. The company declined to make Busch available for an interview. Reached directly by the Post-Dispatch, Busch declined to comment, citing the consulting deal.
If anyone has emerged as the public face of A-B since Busch stepped aside, it’s Dave Peacock, who was Busch’s right-hand man and is now president of Anheuser-Busch. Since InBev acquired A-B, Peacock has led the company’s efforts to maintain alliances with distributors and employees.
Peacock has represented the company for signature events such as the Super Bowl, while speaking on behalf of the company when controversies have arisen, such as the company’s decision to cut more than 1,000 area jobs in December.
A-B InBev acknowledges that Busch’s work for the company has been limited to behind-the-scenes activity. A spokeswoman told the Post-Dispatch that his contributions "have proven very valuable," especially relating to the U.S. market. She did not enumerate those contributions. The company also declined to say how many board meetings Busch attended, or when.
Did InBev ever intend to lean heavily on Busch after the takeover? Veteran consultant Tom Pirko said it was not surprising that Busch was not prominent in the new company’s dealings.
InBev wanted to change Anheuser-Busch’s culture and get rid of the Busch family’s hierarchy, Pirko said. The lucrative consulting arrangement was a way of hitting "the eject button" on the Busch family that had run the brewer since the Civil War.
"They wanted a clean break, without the baggage of the past," Pirko said. "When you do that, you have to remove the faces. To be a new company, you have to have new people."
The apparent withdrawal from public life isn’t just at the brewer. In January, Busch resigned as a director of FedEx Corp., a position he had held since 2003. That same month, he was granted a divorce from his wife of 2 1/2 years.
The next month, Anheuser-Busch held a large meeting of beer wholesalers in Houston. The event, aimed at introducing distributors to the new owners, would have been a perfect place to roll out August Busch IV. It would have been an opportunity to show continuity among all the changes. But he didn’t appear, according to industry observers.
Lately, Busch is splitting time between a new home near the Lake of the Ozarks and his other residence in Huntleigh. Busch, an experienced pilot, has been devoting some time to flying.
Not long ago, Busch was leading one of the world’s biggest brewers, trying to boost it out of a period of slow growth.
After being tapped in 2006 as the new chief executive, Busch became known for a management style more easygoing and low-key than that of his hard-charging father, August A. Busch III. In public appearances, the younger Busch was personable and energetic, Anheuser-Busch’s cheerleader in chief. He popped up at numerous state meetings, industry conferences and legislative summit meetings.
In April 2008, Busch IV rallied employees at a party outside A-B’s packaging plant on Pestalozzi Street to celebrate the 75th anniversary of Prohibition’s end.
"I love you guys, you ladies!" he said to rousing applause. "What an honor. An emotional day." Busch held up a bottle of Budweiser. "Here’s to our future … and another 75 fantastic years. Let’s go get ‘em!"
A few weeks later, at the company’s annual meeting at SeaWorld, Busch showed shareholders some of the company’s Super Bowl commercials, chatted about A-B’s NASCAR sponsorship and urged the hundreds of assembled investors to try some new Bud Light Lime.
Soon after A-B’s board approved InBev’s takeover bid on July 13, Busch started slipping into the shadows.
Perhaps, this shouldn’t have been a surprise, as an early scene of the A-B InBev era suggests.
It was the Monday morning after InBev’s acquisition of A-B was consummated. Busch joined the victorious Brito on a conference call with analysts and reporters. Busch spoke briefly of his faith that the Brazilian executive would "honor his public commitments and continue the traditions that have made Anheuser-Busch a success."
Then, for more than an hour, Brito talked about the future, outlining his plans for the new company. When Brito was through, he asked the St. Louis executives if they had anything to add.
Peacock offered a quick closing comment.
Busch remained silent.
Filed under: management by TheDoor