Bud Light fiasco: Florida’s governor DeSantis steps in, urges review of Florida’s investment in AB-InBev

USA | The Florida governor and 2024 Republican presidential candidate hopes to use the levers of government to go after a megabrand he has singled out for its supposed “wokeness”: Bud Light. In a letter, which became public on 20 July, Ron DeSantis urges the state’s pension fund manager to explore a lawsuit against Bud Light’s parent company.

As Mr DeSantis sees it, AB-InBev “breached legal duties owed to its shareholders”. The governor said that due to the backlash over Bud Light's association with a transgender activist, AB-InBev has suffered sales losses that could hurt Florida workers' pension fund. He added that the brewer’s “radical social ideologies” have turned Bud Light into a “social pariah” and losses have been “staggering”.
 
“We must prudently manage the funds of Florida’s hardworking law enforcement officers, teachers, firefighters and first responders in a manner that focuses on growing returns, not subsidizing an ideological agenda through woke virtue signalling,” Mr DeSantis wrote.
 
Bud Light sales may drop 20 percent this year
 
Sales of Bud Light have plummeted since April, after the brewer entered into a minor partnership with transgender influencer Dylan Mulvaney that precipitated a huge boycott from consumers and led Bud Light to lose its title as America’s best-selling beer to Modelo. In 2023, sales of Bud Light could fall by more than 20 percent, according to recent estimates by Morgan Stanley, an investment bank.
 
The State Board of Administration (SBA) is Florida’s main asset management organisation, overseeing over USD 250 billion. That includes the USD 180 billion by the Florida Retirement System Pension Plan Fund. At the end of March, the pension fund held more than 682,000 shares of AB-InBev, valued at the time at nearly USD 46 million. AB-InBev’s stock price has fallen since then, from USD 66 per share to USD 58. It is still higher though than in September 2022 - when it stood at USD 44 per share - well before the firm’s recent controversy.
 
Little or no legal merit
 
Observers doubt that Florida’s pension fund has legal recourse for breach of a duty to it by AB-InBev’s board. In plain English: the state pension fund will not be able to prove in a lawsuit that AB-InBev intended to harm its shareholders by launching this marketing campaign.
 
The question bugging pundits is why Mr DeSantis did not push for legal action against AB-InBev sooner? He has been a staunch supporter of the Bud Light boycott for months. Could it be that he is trailing Mr Trump by double digits in public opinion polls, and he is burning his campaign money faster than he can raise it? In another sign of the financial strain on the campaign, Mr DeSantis fired a dozen staffers in what media described as a cost-cutting measure on 22 July.