Budweiser products sit opposite Miller products at Discount
Liquor on Tuesday.
Charles Auer/Freeman Staff
SUSSEX - Waiting to meet with other
MillerCoors distributors from across the country
Tuesday, Beer Capitol Distributing Co. CEO Aldo
Madrigrano said he was confident about the iconic
brewer’s future in Milwaukee and his company’s trucks
would never add Budweiser products to their loads.
Early Tuesday, British-based SABMiller announced it
accepted in principle a $106 billion takeover offer from Anheuser
Busch InBev that would result in the world’s largest beer company.
It was the sixth offer that AB InBev had made to SabMiller in recent
If the merger is approved and then makes its way
successfully through regulatory committees, the combined company
would control about 31 percent of the beer sales globally. According
to a statement Tuesday, AB InBev has agreed to pay $3 billion to
SABMiller if the deal fails to close because of failure to get
regulatory approval or the clearance of the AB InBec shareholders.
Madrigrano said he spoke with MillerCoors spokesmen
Tuesday after the news was announced and he was satisfied concerning
the company’s future in Milwaukee. Sussex-based Beer Capitol
Distributing Co. is the largest distributor in the state and one of
the largest in the country for Miller products.
A main concern that Madrigrano expressed regarding
the deal is that the right team is in place to handle the logistics.
From a day-to-day operations perspective, Madrigrano said, he
doesn’t believe there will be much local impact and that he can’t
envision a day when Miller distributors like Beer Capitol would also
deliver Bud products and the same is true for Anheuser Busch
delivering MillerCoors items.
Beechwood Sales & Services in New Berlin distributes
products for AB InBev. That company’s president was not available
for comment Tuesday.
While the deal is worked out by the two beer giants,
Madrigrano said he will keep an eye on the process. Another recent
deal in 2013, during which AB InBev bought 50 percent of Grupo
Modelo in Mexico for $20.1 billion, resulted in Modelo having to
sell off the Corona brand in the U.S. and other U.S. businesses.
After the deal was announced, the U.S. Justice Department had filed
an anti-trust suit, according to a news story by CNN.
In comparison, Madrigrano said the pending merger
between SAB Miller and AB InBev is much larger.
Going forward, Madrigrano said he is confident in
MillerCoors’ commitment to Milwaukee and southeastern Wisconsin,
saying the company has committed to invest about $10 million to $12
million in its Milwaukee facility this year.
“That’s a major piece for us. We want to make sure it
stays in Milwaukee and we will be confident that they will stay
here,” he said.
Madrigrano also hopes that the Milwaukee brewery and
its operations continue at their normal pace and the distributors
and other companies don’t get “caught up in the stuff going on.”
could be one huge monopoly’
As a longtime seller of Miller and Budweiser
products, Frank Greguska Jr. of Discount Liquor said he questions
how products would be distributed if the two companies merge and
what that would do to prices. Many Wisconsin and micro-breweries,
such as Lakefront Brewery and New Glarus Brewing Company, are
distributed by the same companies that distribute Miller and Bud
products - something many people aren’t aware of.
“That could be one huge monopoly if you want to call
it that,” Greguska said.
Matthew Fixx, whose son owns Fixture Brewing Company
in Waukesha, compared the deal to there being only one bank or one
car company in America.
“It’s liking having one bank; they can charge
whatever they want,” Fixx said.
He thinks Bud and Miller drinkers would stay loyal to
their brands, but hopes others would turn to craft brews in light of
the giant international company controlling so much.
Nick Reistad, a co-owner of Raised Grain Brewing
Company in Waukesha, also hopes more people will find the value in
locally produced beer.
“It certainly (creates) an interesting quandary in
Wisconsin because Miller is such a strong presence in our
community,” he said of the possible merger. “Miller is definitely
part of the Wisconsin identity. We hope that everything turns out
well for them.”
Reistad said he heard that Miller may be spun off as
part of the merger.
“It’s so strange that Miller would combine with
Budweiser knowing there has been such a feud between them for so
many years,” Reistad said. “For us, it doesn’t really change the
direction for what we are doing. We are focused on great beer and a
AB InBev has until Oct. 28 to make a formal offer if
U.K. regulators grant an extension to the takeover talks. The new,
merged company would dwarf the next biggest player, Heineken, which
has 9 percent of the market. A combined company would have total
annual sales of $73.3 billion.
In addition to Budweiser, brands owned by AB InBev
include Stella Artois and Beck’s. SABMiller, which is based in
London, makes Miller Genuine Draft, Peroni and Milwaukee’s Best.
$106 billion takeover offer made by Anheuser Busch
InBev for SABMiller;
$3 billion to be paid by AB InBev for SABMiller if
Oct. 28 is the date on which AB InBev has to
formalize the offer;
9 percent is the percentage of the market held by the
world’s largest beer maker, Heineken;
31 percent of the market that would be held by a
combined AB InBev and SABMiller;
$73.3 billion in annual sales if the companies
Source: The Associated Press
Also contributing: The Associated Press