Former Bud Light executive comments on Bill Gates’ acquisition of Bud Light’s parent company.
A Former Executive Criticizes Bill Gates’ Investment in Bud Light
A former executive with Bud Light responded to billionaire Bill Gates’ foundation purchasing nearly $100 million shares in its parent company amid a months-long boycott.
“Bill Gates is definitely making a mistake,” former Anheuser-Busch executive Anson Frericks told anheuser-busch-exec” target=”_blank” rel=”noopener”>Fox Business this week. “Earlier this year, he already made a $900 million mistake when he invested into one of Anheuser-Busch’s largest rivals, Heineken. He did that earlier this year. And since that investment, Heineken’s down about 10 percent, whereas the broader markets are up 10 percent.”
The Bill and Melinda Gates Foundation Trust, which Mr. Gates helped co-found, purchased about 1.7 million shares of Anheuser-Busch InBev, which owns Bud Light, for about $95 million in the last quarter, according to a recent regulatory filing. He has not issued a public comment about the purchase.
Questionable Investment Choices
“So if I was looking for advice on investing to software companies, tech companies, I might go to Bill Gates. But if you’re looking at the beer industry, he doesn’t have a great track record of investing in winners at this point,” Mr. Frericks, who has been critical of Bud Light, said on Wednesday.
Anheuser-Busch’s American division reported about a 10 percent decline in profits in the second quarter due to a boycott that was initiated in April after Bud Light made a promotional package for a transgender activist. Conservatives, after learning of the news, were swift to call for action against Bud Light, which also lost its top spot to Modelo Especial earlier this year.
Sales of Bud Light have dropped year-over-year in many consecutive weeks. As of Aug. 19, sales volumes of Bud Light at off-premise locations like grocery stores fell by 20.1 percent so far this year, as compared to the same period last year, according to Nielsen IQ sales data via Bump Williams Consulting.
“For the company’s sake, they’d probably be better off [with] maybe somebody who is more of, kind of the everyman type of person, maybe like a Rob Gronkowski or somebody like that was investing into Anheuser-Busch, not necessarily somebody like Bill Gates. That doesn’t really resonate with sort of that common man that everyday Bud Light beer drinker,” Mr. Frericks said.
One analyst recently wrote that it’s not clear whether Anheuser-Busch InBev or its distributors will have to make “structural changes.” Anheuser-Busch confirmed weeks ago that it laid off about 300 of its corporate employees in the midst of the backlash.
“Continued weakness begs the question of whether Anheuser-Busch InBev and/or its distributors will have to make significant structural changes to reduce their cost basis if trends don’t improve over the next few months,” Evercore ISI analyst Robert Ottenstein wrote in a recent note, Yahoo Finance recently reported.
Sales were also stale the week prior. As of Aug. 13, Bud Light’s sales dropped 28.1 percent year-over-year, as well as volume declines of 28 percent, according to data from Evercore ISI and Circana.
The boycott started when Bud Light sent a personalized beer can with transgender influencer Dylan Mulvaney’s face on it, which was then posted on social media. Conservatives were quick to react, with musician Kid Rock using Bud Light cans as target practice, while several country singers said they wouldn’t serve the brand.
Former President Donald Trump also responded to the controversy, saying that brands should cater to left-wing trends or demands.
“It’s time to beat the Radical Left at their own game,” the former president said in a post on Truth Social in May. “Money does talk—Anheuser-Busch now understands that.”
His chief GOP rival, Florida Gov. Ron DeSantis, also said he is opening an investigation into Bud Light and whether it failed “to remediate the problem and repair its relationship with millions of disaffected American consumers.”
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