There is a lot of blame going around regarding who exactly is responsible for Anheuser-Busch’s (BUD) sale to InBev. The main culprits include the weak dollar, a stagnant business model, and, of course, the Busch family.
The anecdote below, related by David Kesmodel of the Wall Street Journal, says a lot about the Busch’s stubborness and recent failures. If BUD had simply purchased a majority stake in Mexican brewer Grupo Modelo sometime over the past decade, the theory goes, the takeover would have been avoided. However, August Busch III, the current CEO’s father, screwed it all up (WSJ):
When A-B was negotiating to buy a minority stake in Modelo, an A-B consultant, speaking metaphorically, told the brewer’s then CEO, August Busch III, that he needed to “go hunting and fishing” with Modelo executives to win their trust.
An outdoorsman, Busch III took a literal approach. He invited Modelo executives to join his team for a weekend of sport fishing off the shores of Cabo San Lucas, where he had enjoyed his honeymoon. Modelo insisted on paying for the trip because it was in Mexican waters.
Under a bright blue sky early one morning, several boats fanned out in the Pacific. Busch III hooked a huge marlin, says a person who was on the excursion. As Busch III fought the massive fish, he was told he had a phone call–important business back in the U.S. Instead of reeling, Busch III took the call. He handed the rod to a bewildered Valentin Diez, a senior Modelo executive and major shareholder.
Busch III soon decided he needed to be back in the U.S. that night. The fishing, planned for two or three days, would have to end the first day. Busch III paced and stared at his watch. When told it could take up to four hours to land the marlin, he said that was too long, say people who were on the trip. Busch III said he needed to get back to shore soon for his flight home, and that the Modelo team needed to move expeditiously to bring in the fish.
“Diez felt awkward,” says a person who went on the trip. “He thought, gee, how important is this deal [with Modelo] to August if we are getting rid of a fish and we’re going back home and I’m playing second fiddle?”
Diez wasn’t able to land the marlin. It disappeared into the sea within about 30 minutes.
Later, Diez remarked that he was angry that Busch III had been so aggressive and domineering when it was Busch III who had invited the Modelo executives on the outing, says the person familiar with Diez’s thinking.
“That story explains it all,” says another person who went on the trip. “You’ll do it my way or you’ll die.”
Read full story on WSJ >