In Eastern Europe you may have to decide which Bud is for you.

The Budweiser dispute is an ongoing series of legal disputes between Anheuser-Busch and Budweiser Budvar Brewery. The conflict dates back to 1907 and has involved over 100 court cases worldwide. In 1907 Budweiser Budvar and Anheuser-Busch came to an agreement that AB would have exclusive rights to the brand name in North America, while Budvar could market its similarly named product in Europe. This agreement limits AB’s access to over 360 million beer drinkers in Europe and has led to 40 different trademark dispute cases (recent ones in photo to the right).Screen Shot 2015-11-16 at 11.11.45 AM

 

 

“Beer was first brewed in Budweis in 1265. By 1531, the city was supplying beer to the court of King Ferdinand I of Bohemia. Ethnic Germans set up the first company using the Budweiser name in 1795, and a century later, the current European company was formed and registered the trademark. The brewery was nationalized after the Communists took over in Czechoslovakia in 1948” (wikipedia.com). Despite the history of the Budvar Brewery, AB today maintains 150,000 employees producing some 400 million hectoliters of beer, while Budejovicky Budvar 0.35 percent that amount of beer last year( its best ever )and only employs 600 people. The Budvar brewery is a state owned enterprise, a arrangement that is thought to be temporary even as the brewery remains profitable. The privatization of the business would require the Czech government to auction the firm to the highest bidder, and who would like to see the acquisition of the company more than Anheuser-Busch itself? Settling over a century of legal disputes and acquiring access to more of the European market, this would be the ideal development for AB in the coming years.

3 thoughts on “In Eastern Europe you may have to decide which Bud is for you.

  1. Beautiful explanation of the conflicts between Anheuser-Busch and Budweiser Budvar Brewery. I wonder, what impact would this hypothetical acquisition have on the world beer industry? Additionally, in your research did you come across any other possible players in this potential transaction. If so, the price tag on this deal could skyrocket!

    • It certainly would consolidate the industry further, especially considering the pending AB and SAB merger. I did not see the other potential bidders on the possible sale of Budvar, but I imagine that AB has enough cash on the balance sheet to pay any premium a bidding war might generate.

  2. Like it or not, “Budweiser” is an existing brand in Europe that may be unknown (or worse) viewed as an inferior niche beer. So while AB InBev might be able to buy the right to use the name, how useful would that be?

    Yes, since the 1880s there have been two “world” wars and a long period of government ownership. Still, as noted in the post, if Anheuser-Busch was really interested, then surely they could have paid a princely amount sometime in the past 110 years to buy global rights?!

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