09 December 2008

Blagojevich's Words Strike Back

Illinois Governor Rod Blagojevich was arrested this morning at his Chicago home by Federal authorities in connection with an alleged scheme to sell the U.S. Senate seat being vacated by President-elect Barack Obama. Law enforcement took Governor Blagojevich into custody just after 6 a.m. after a telephone call awakening the second successive sitting Illinois governor to be arrested on conspiracy charges. In an afternoon media conference, federal authorities stated that they took the governor away in handcuffs without waking his children, but that his wife, the daughter of Chicago alderman Richard Mell, was aware of the arrest. The governor's top aide, John Harris was also arrested in connection with the allegations that Blagojevich wanted to benefit from his ability to appoint the next Senator. The 76-page brief released showed that the two men engaged in conversations which led to charges of conspiracy to commit wire fraud and mail fraud and solicitation of bribery.
The media release from the office of the U.S. Attorney - Northern District of Illinois outlines most of the charges: http://www.usdoj.gov/usao/iln/pr/chicago/2008/pr1209_01.pdf

This afternoon, Blagojevich appeared before U.S. District Judge Nan Nolan who released the Illinois governor on 45-hundred dollars cash bond.

The Governor's office issued a statement saying the "allegations do nothing to impact the services, duties or function of the state."

Governor Blagojevich predecessor, George Ryan, is serving a six-year ;prison sentence after being convicted on federal charges of racketeering and fraud.

08 December 2008

A-B/InBev: 1400 Layoffs Announced

What's to say that Anheuser-Busch isn't about to be surpassed by another local brewery as the largest holder of market share in St. Louis?

That thought was not even a glimmer in the eyes of most St. Louisans until earlier this year when InBev offered and then bought the world's largest brewer from its local owners. Now, the news comes today from the newly-named A-B/InBev that 14-hundred salaried jobs will be eliminated due to the merger of A-B and InBev --- approximately 75-percent of those positions will come from St. Louis.

The InBev brew-crew announcing today that they would eliminate 415 contractor positions and not fill 250 company-wide U.S. jobs which had been open and unfilled. In a statement released today, the president of Anheuser-Busch, David A. Peacock said the moves were being made to "keep the business strong and competitive" and added "this is a necessary but difficult move for the company" and further stated that the company "will assist in the transition for these employees as much as possible."

The media release also stated:
"The company will provide employees severance pay and pension benefits based on age and years of service. Employees also will be offered additional benefits during the transition, including outplacement services. The announced workforce reductions are in addition to the more than 1,000 U.S. salaried employees company-wide who accepted the company’s voluntary enhanced retirement program, which closed November 14 and provided special benefits for eligible employees retiring by the end of 2008. The retirements were part of planned cost reductions of 1 billion dollars (U.S.) called project Blue Ocean, announced by Anheuser-Busch in June 2008. At that time, the company announced plans to reduce its company-wide U.S. full-time salaried workforce of 8,600 by 10 to 15 percent before the year end. The company’s other Blue Ocean cost reductions remain on track.
The plans announced today are an integral part of the at least 1.5 billion dollars (U.S.) in annual synergies identified by InBev when it announced its combination with Anheuser-Busch in July. The company is confident in its ability to achieve against this synergies projection by 2011. Going forward, in addition to the priority to continue to grow the top line, Anheuser-Busch InBev will focus on its goals of integrating the businesses, delivering the expected synergies and deleveraging the company."



["deliveraging the company", eh? Is that delivering the enraging of those who respected the company?]

So, now come those questions about who will step-up to grab the largest market share now that the "local favorite" is no longer "locally owned and operated". For decades it was assumed that A-B would never surrender the local customers. However since this deal has now started to show its teeth on the local economy (most of the A-B jobs to be eliminated will either be gone by the end of 2008 or certainly by the end of 2009), the customers will start to find other brewskies...locally-brewed beers seem to be favored by the general public. As the only large option for more than a decade was the St. Louis Brewery and Tap Room's Schlafly Beers [which has become the city's only large and locally-owned beermaker --- thank you very much Tom Schlafly]. the Schlafly labeled products made many endroads and was found in bars and on grocers' shelves, alongside the Buds, Michelobs, Coors, Miller Lite, imports and other domestics such as Sam Adams and Kansas City's Boulevard (I'm rather partial to their wheat and the Schlafly Hefeweizen). But in more recent days, O'Fallon Brewery (St. Charles County) has found its way onto the store shelves and in bars and pubs. This, and several other locally brewed and marketed beers, are setting up something different: the brew-ha-ha over which company stands to benefit the MOST from the loss of A-B jobs. See how this works yet?

By the time I got to publishing this on here, I'd read several online comments in regard to the announcement today --- and there were comments of "buy Schlafly" and "Schlafly and O'Fallon" --- which should come as no surprise to most St. Louis beer drinkers, and even those who don't drink the beer but follow the business news.

What's next?

In the coming weeks, the local market share of A-B will likely diminish --- again. "Again" is a statement because after the city's A-B beer distributor locked out the union workers a couple of years ago, they struggled to regain some of their business. And it appears that St. Louis beer drinkers have a better memory than those atop A-B/In-Bev would think. The question is --- will they retain the largest market share, or will A-B/In-Bev find themselves down a few notches by mid-summer 2009? There is no crystal ball on this.

So, who is up for a locally-produced Schlafly Hefeweizen or Oktoberfest or Pale Ale, or an O'Fallon Gold, or a Morgan Street Honey Wheat or Irish Stout, or a Trailhead Brewery Blonde Ale? It could be literally thousands of St. Louisans who will claim to be "fed up with InBev" and won't buy their beer. If that is the case, then there are a few local breweries who may have to ramp-up their production even in these tough economic times. Certainly whoever will be marketing their local products in the most outstanding way (read: spend lots and lots of money on advertising) will likely see some benefit from the action that locals will say was perpetrated by InBev.