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St. Louis mayor: ‘The concern is we don’t really know InBev’

Monday, July 14, 2008 | 6:05 p.m. CDT; updated 10:19 p.m. CDT, Monday, July 21, 2008

ST. LOUIS — There was little else on the minds of St. Louisans on Monday than the sale of one of the city’s most famous icons to Belgian brewer InBev.

From a variety of bartenders and analysts to charities that benefit from Anheuser-Busch’s largesse, everyone was speculating on the future of a city that no longer will be headquarters for the King of Beers.

Somber-looking Anheuser-Busch workers had little to say as they walked into work Monday.

Financial analyst Juli Niemann of Smith Moore & Co. investment brokers said workers are fearful and angry about the possibility of losing jobs, and they might have good reason.

Anheuser-Busch’s cost-cutting plan, aimed at thwarting InBev’s takeover effort, had already spread the pain across the board.

But InBev’s approach is more surgically precise, Niemann said. In a company that watches costs very carefully, employees must justify their job every year.

Where Anheuser-Busch executives travel by private jet, Niemann said InBev folks will be flying coach to St. Louis — and taking the city’s light rail system, not a cab or limousine, from the airport to A-B’s Pestalozzi Street headquarters.

“They’ll start cutting from there,” she said. “They’ve got it down to a science. They’re very smart people.”

St. Louis Mayor Francis Slay said just about everyone who lives in the region has been touched in some way by the brewery — including visits to Busch Stadium, or company-sponsored community events, and charities that benefit from the millions of dollars Anheuser-Busch donates each year.

“We know Anheuser-Busch,” Slay said. “The concern is we don’t really know InBev.”

InBev CEO Carlos Brito has said St. Louis would be the company’s North American headquarters should the deal go through, but it isn’t yet clear what that will mean in practical terms.

“They’ve never promised me they wouldn’t eliminate jobs,” Slay said.

If Anheuser-Busch had fought the sale, the city likely could have helped in some way, Slay said. Now that the companies have agreed to a deal, the city will focus on keeping the brewery’s presence strong in the city, with a focus on maintaining the quality of pay and employee benefits.

Jack Cipriani, who heads the brewery workers division of the Teamsters, said he has called for a meeting of InBev unions in Canada, Brazil and Brussels, and has asked Brito and A-B for more information. He’s gotten no response.

“We worry about employees losing jobs, we worry about their communities,” he said. “Their (labor relations) record has not been a good one.”

At Hammerstone’s bar, near the brewery, off-duty bartender Brian Adams said he likes drinking the local beer, like his father before him.

“You know what’s surprising, some brewery people have come in, and nobody really wants to talk about it,” said Adams, 25. “I think we’re in a limbo, a decision-making stage.”

He fears a possible loss of jobs but said what InBev had promised thus far sounded good.

“I think people have a lot of questions that can only be answered in time,” he said.

Not everyone is wary of InBev’s takeover.

Benjamin Akande, dean of Webster University’s school of business, said St. Louis hasn’t lost an iconic company; it has gained a global operation.

InBev, he said, isn’t just buying A-B beer, but also its intellectual powerhouse — the people from the top executives to the foot soldiers who ensure product quality and delivery.

“Anheuser-Busch-InBev needs to be led by trusted faces,” he said. “If they miss this opportunity and have the notion of cutting and slashing employees, they would expose themselves to incredible execution risk.”

He also warned InBev against dumping A-B’s nonbeer assets. The Busch entertainment empire, including the SeaWorld and Busch Gardens amusement parks, connects with customers.

St. Louisans rarely say Anheuser-Busch. Here, the company is known by a familiar shorthand, “A-B” or “the brewery.” The beermaker has made an indelible stamp on the community — down to the gargoyles that guard the tidy and historic red-brick brewery on the city’s south side.

A-B’s trademark eagle with outstretched wings is seen in worldwide advertising and in bars around town. Its Clydesdale horses, celebrities in their own right, make guest appearances.

For more than 50 years, locals have brought their children to Grant’s Farm, the 281-acre ancestral home of the Busch family, where people line up for a tram ride to see exotic animals or bottle-feed goats in a petting zoo.

Anheuser-Busch gave its name to St. Louis’ three successive baseball stadiums as well as galleries, buildings and green spaces around town. Along with the Gateway Arch and the Mississippi River, A-B is part of St. Louis’ civic identity.

Niemann said InBev did all the right “face-saving” measures, keeping the A-B name, retaining the historic brewery on Pestalozzi Street and the Clydesdale horses.

But don’t expect philanthropic contributions to remain the same. The shirts, the golf bags at the charitable auctions, the keg to the local Catholic church picnic, will be things of the past, she said.

Anheuser-Busch gave $13 million last year to such charities as the American Red Cross and St. Louis Zoo.

Lucie Springmeyer, who heads Forest Park Forever, which restores and maintains the crown jewel of the city’s park system, Forest Park, said a major gift from Anheuser-Busch sends a message to other corporations that a charity is worth their attention. A $3 million gift to Forest Park Forever from Anheuser-Busch in 1999 helped pave the way for an endowment that now stands at roughly $26 million.

Skeptical politicians vowed to make sure the newly joined company would maintain a strong local presence.

U.S. Sen Claire McCaskill said she would strive to make “the new arrangement work for Missouri,” while U.S. Sen. Kit Bond said he told Brito on Monday that A-B employees, Missouri farmers and businesses, and the community at large want assurances they’d continue to benefit from the brewery’s success.

“I suggested to him he needs to keep all those customers,” Bond said.


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Comments

trisha freitag July 15, 2008 | 3:05 p.m.

I remember when TWA was bought out by American. My husband had 31 years in with TWA. Over 18 months he went from making over $45K a year to $12 an hour. Still, we had the benefits. 2 years after the ownership changed hands, he was informed that his job had been outsourced. He was given a 90-day-notice that he was being laid off without chance of recall after 33 years of faithful service.

After 6 months with no job, a program set up for displaced TWA workers trained him for a job that paid $9 an hour. He worked that job for a year and finally found an opening in a factory. After 3 years, he is now making just over $13.50 an hour. He's 60 years old and doing hard, exhausting physical labor. This was his reward for being a loyal employee of TWA when American bought out the company, promising to keep the jobs and treat the employees as their own.

When the layoffs started after 9-11, TWA employees were the first to go. The flight attendants had lost all seniority and benefits when they moved to American. These people ended up as nursing assistants, truck drivers, factory workers, and doing many other low-paying jobs.

This is what the A-B workers have to look forward to. Face it - the company that bought it out is going to look out for their own workers first. It's good business sense but it's bad news for the people who have banked on retiring from A-B after many years of dedicated service. If positions have to be cut, they will be cut from the current workers because the new owner feels no loyalty to them.

It's about the almighty dollar. It's not about commitment and dedication any more. Businesses focus on getting the most for the least, and if that means letting people go who were loyal to the company they are acquiring in favor of others who will work for less money and accept less benefits, then that is what will happen. We can hope all we want, but the writing is on the wall.

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