AB-InBev not interested in buying Budweiser Budvar
It was a bit of a damp squib: On 16 May 2013, following the recent developments in the EU-wide trademark registration case for Bud, AB-InBev’s top legal counsel Frank Hellwig tracked all the way to Prague for a special press conference to announce that the world’s major brewer was not interested in buying the Czech beer icon Budweiser Budvar and how did the country respond?
Apparently, Czech Jo Sixpacks never registered this announcement as reports from the press conference did not make it into mainstream Czech media. Online media picked it up willingly enough but no major print publication carried the story. Which makes us wonder: Was this low-profile reporting really AB-InBev’s design?
In any case, it’s hard to fathom if the Czechs are glad that the foreign predator, as they like to see AB-InBev, has given up its hunt for the state-owned brewery Budvar, although this would have been the first time that AB-InBev officially admitted such plans.
The reason for the recent press conference was the January 2013 decision by a European Union high court that only AB-InBev has the right to use the trademark “Bud” in Europe after rejecting a challenge from Budvar. As Budvar failed to appeal this ruling, AB-InBev now expects to receive the registration for the Bud trademark in the near future.
Mr Hellwig also said that, although AB InBev is not interested in buying Budvar, it remains open to constructive discussions about a settlement for the trademark litigation that has been going on for more than 100 years. This invitation was extended to Budvar even if the need for AB-InBev to come to such an agreement has become less relevant after the series of legal successes that AB-InBev booked in the last couple of years.
Indeed, globally, today AB-InBev has Bud or Budweiser trademark registrations in all but 12 countries (vs more than 50 in 1992 and approximately 25 in 2002), a spokesperson for AB-InBev told BRAUWELT International.
What Budvar made of the announcement by AB-InBev is equally a matter of speculation. The initial response was one of surprise. “For many years AB-InBev have said that they are only interested in the trademarks and not in the brewery itself”, Budvar’s spokesman Petr Samec was quoted as saying. He added that such an intent – the purchase of the Budvar brewery – has never been openly admitted. He remarked further that AB-InBev’s intentions are clear: to obtain the Budweiser trademark globally as the use of the Bud trademark instead of the Budweiser one outside of North America was only a fallback option.
Secretly, Budvar cannot have been too pleased with AB-InBev’s announcement as the implied or alleged threat of a takeover by AB-InBev (which could lead to Budvar being demoted from a small-scale international player to a domestic player in the Czech Republic only) has long been Budvar’s line of self-defence whenever a Czech government dared to merely consider the privatisation, ie the sale, of the state-owned brewery.
In 2012 Budvar’s beer exports reached a new high: it exported 657,000 hl to 58 countries, the bulk of which went to western Europe. Total beer output was 1.34 million hl, up 2 percent on the previous year. Turnover was CZK 2.1 billion (USD 104 million), up CZK 100 million (USD 4.9 million) year-on-year.
A sale of Budvar is currently not on the government’s agenda, insiders say. But it does not mean that it’s totally and in all perpetuity off the agenda either.
It seems that with AB-InBev having stated its disinclination, Budvar’s line of argument has become seriously weakened, not to mention its justification for its high legal bills which must have eaten away at its profits in recent years.
