E-Malt.com News article: USA: Warren Buffett’s holding company Berkshire Hathaway Inc. slimed stake in Anheuser-Busch from 5.6% to 4.7%

Warren Buffett’s holding company, Berkshire Hathaway Inc., sold more than 7.1 million shares of Anheuser-Busch Cos. Inc. stock between June 30 and Sept. 30, according to a Nov. 14 regulatory filing, The Business Journal of Jacksonville published November 27.

The divestiture represented about 16.3 percent of Buffett's holdings in the brewing giant and decreased his ownership stake in the company to 4.7 percent from 5.6 percent.

Buffett still owns about 36.4 million Anheuser-Busch shares valued at nearly $1.7 billion, based on the company's November 21 closing price of $46.37 a share. That means he remains one of the brewery's largest owners, but no longer claims the top spot.

Only two investors controlled 5 percent or more of Anheuser-Busch's stock when the company filed its most recent proxy statement in March. Berkshire Hathaway, of Omaha, Nebraska, was the largest shareholder, with a 5.6 percent stake. Barclays Global Investors NA of San Francisco came in a close second at 5.5 percent. Berkshire Hathaway's stock sale indicates those investors have traded places in the ownership rankings if Barclays has not significantly altered its holdings since March. No Anheuser-Busch filings show a change in Barclays' stock ownership.

Anheuser-Busch officials did not return a call for comment. Buffett's policy is to not discuss specific stocks or investment ideas.

Anheuser-Busch Cos. Inc., based in St. Louis, is the largest domestic brewer and also manufactures and recycles aluminium cans and operates theme parks. The company's Jacksonville brewery is the fifth-largest manufacturer in Northeast Florida with 620 employees, according to The Business Journal's 2006 Book of Lists.

Analysts appear to be mixed on how to interpret Buffett's move. Some are again dismissing the notion that Berkshire Hathaway's stock sale serves as some broader indication of Buffett's lack of faith in the business.

"I wouldn't panic or say Warren's lost confidence in Anheuser-Busch," said Matthew Reilly, an analyst with Morningstar Inc. "To me, at this point, it's just noise. They are not day traders by any means. It makes me think there could be a tax implication or something else mechanical going on."

Others suggest Buffett is recognizing some of the widespread long-term concerns about the domestic beer market.

Beer sales in the United States have been flat in recent years as the industry has faced continued pressure from wine and spirits. Even though Anheuser-Busch remains the nation's largest brewer, with market share of about 49 percent, analysts predict it will be difficult for the company to generate anything more than modest increases in sales volume and profits under its current business model in today's market environment.


29 November, 2006