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The Bill and Melinda Gates Foundation Trust quietly acquired 1.7 million shares of Anheuser-Busch in August.
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They previously invested around $1 billion in Heineken Holding earlier this year.
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Sales data reveals a bleak picture for Bud Light, with a 28.1 percent year-over-year decline in sales as of August 13, coupled with a 28 percent drop in volume.
In a surprising move, billionaire philanthropist Bill Gates has made a significant financial investment in the parent company of Bud Light, Anheuser-Busch, at a time when the beer brand has been grappling with a prolonged boycott.
This investment, according to The Epoch Times, worth approximately $95 million, comes at a critical juncture for Bud Light, which faced backlash due to a controversial promotional campaign featuring transgender activist Dylan Mulvaney.
The Bill and Melinda Gates Foundation Trust quietly acquired 1.7 million shares of Anheuser-Busch in August, months after the boycott against Bud Light gained momentum. Interestingly, Mr. Gates, who has publicly stated that he’s not a big beer drinker, has also diversified his investment portfolio within the beer industry, having previously invested around $1 billion in Heineken Holding earlier this year.
Despite the ongoing boycott and declining sales of Bud Light, Morgan Stanley analyst Sarah Simon remains optimistic about Anheuser-Busch’s prospects. Simon believes that the company could return to “profitability growth” in the near future, largely due to its strong presence in emerging markets, which mitigates the impact of U.S. market share losses. This positive outlook is underscored by Simon’s prediction that profitability will resume in 2024, with robust cash flow growth potentially enabling increased payouts and share buybacks from 2026.
The boycott of Bud Light has had a noticeable impact on the brand’s sales, leading to consecutive weekly declines. Anheuser-Busch’s U.S. division confirmed layoffs of approximately 300 corporate employees as a result. The decline in Bud Light sales has also affected Anheuser-Busch InBev’s overall earnings, causing a 10 percent drop in U.S. revenue in the second quarter.
Sales data reveals a bleak picture for Bud Light, with a 28.1 percent year-over-year decline in sales as of August 13, coupled with a 28 percent drop in volume. Evercore ISI analyst Robert Ottenstein suggests that if these trends persist, significant structural changes may be necessary to reduce cost bases for Anheuser-Busch InBev and its distributors.
On a year-to-date basis, off-premise sales volumes of Bud Light in locations such as grocery stores have fallen by 20.1 percent, accompanied by a 15.9 percent drop in Bud Light sales in comparison to the same period last year.
The controversy surrounding Bud Light began when the brand featured transgender activist Dylan Mulvaney’s face on a promotional beer can. This move sparked swift backlash, with musician Kid Rock using Bud Light cans for target practice. Prominent conservative figures, including former President Donald Trump and Florida Governor Ron DeSantis, also criticized Anheuser-Busch for what they perceived as catering to left-wing pressure.
DeSantis even called for legal action against Anheuser-Busch, claiming that the company’s promotional materials for the activist constituted a breach of its duties to shareholders. In response, Anheuser-Busch emphasized its commitment to shareholders, employees, distributors, and customers.
The Bud Light boycott initiated a broader trend of boycotts against brands with perceived pro-LGBT stances, including Target. While the impact of these boycotts remains a topic of debate, they highlight the growing influence of consumer sentiment in shaping corporate decisions.
In a polarized climate, where passions can be easily ignited, consumers are increasingly eager to channel their efforts toward causes they believe in. Bill Gates’ strategic investment in Anheuser-Busch signals a potential turning point for the beleaguered Bud Light, which, despite its recent challenges, still holds significant promise in the eyes of some analysts.
As this situation unfolds, it raises important questions about the intersection of business, activism, and investment in today’s complex and interconnected world.
With information from The Epoch Times.
