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Anheuser-Busch InBev to cut 1,400 US jobs
2008-12-08
BRUSSELS, Belgium - Anheuser-Busch InBev announced Monday it would cut some 1,400 U.S. jobs -- or another 6 percent of its U.S. work force -- to help save the world's largest brewer at least $1.5 billion a year. It said three-quarters of the jobs to disappear will go from Anheuser's North American headquarters in St. Louis, both at downtown offices and its Sunset Hills campus. The job cuts go beyond plans Anheuser-Busch announced this summer to streamline costs, before it agreed to be taken over by Belgium-based InBev. The company said the job losses will help it save at least $1.5 billion a year by 2011 and cope with a "challenging economy." Most of the cuts will be made by the end of the year. Anheuser-Busch provides half of America's beer but it has not managed to expand around the world as fast as InBev -- a Belgian-Brazilian hybrid that owns hundreds of local brands but few real stars. InBev SA wrapped up its takeover of Anheuser-Busch Cos. Inc last month after a bitter takeover battle turned sweet with a higher $52 billion takeover bid. Anheuser-Busch had 8,600 salaried workers this summer and had planned to reduce that by 10 to 15 percent, mostly by offering some 1,000 employees a voluntary early retirement package. That aimed to save the brewer some $1 billion a year. The new job losses mean the brewer will lose around a quarter of the salaried workers it had at the start of 2008. More than 250 unfilled jobs will be slashed and an extra 415 contractor positions will be eliminated. About a quarter of the jobs to go will be in field and brewery locations, it said. "To keep the business strong and competitive, this is a necessary but difficult move for the company," said Anheuser-Busch president David A. Peacock. Workers who form part of a trade union at the company's 12 breweries in North America will not be affected. InBev had pledged not to close any of the breweries as long as it was not forced to pay any extra taxes. The redundancies will cost the company $197 million before tax, mostly in severance payments and pension benefits. The takeover deal gave InBev control over America's iconic Budweiser beer -- and gave Bud the chance to sell more widely into rapidly growing markets in Latin America, eastern Europe and Asia where InBev draws most of its profit. Beer sales in North America and Europe are slowly declining. InBev is renowned for its tight control of costs since the company was formed in a 2004 merger between Brazil's AmBev and Belgium's Interbrew. The Brazilian management team who headed the company had a sharp focus on costs that came as a shock to the European business.
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