Busch's Last Call in St. Louis?

By David Von Drehle

Poor St. Louis. Everyone has a tear or two for gritty cities facing hard times -- for the Detroits, the Clevelands, the Buffalos -- but who spares a thought for the elegant dowager reduced to reusing tea bags? St. Louis was never a rude boomtown. It was the Midwestern city with an Athenian heart, valuing music and philosophy, nurturing a great university, birthing poets and hosting, in one incredible zenith year, both the World's Fair and the Summer Olympics.

Unfortunately, that zenith was 104 years ago.

The fourth largest U.S. city in 1900 today doesn't make the top 50, ranking somewhere between Wichita, Kans., and Bakersfield, Calif. No city in American history has slid so far -- nor with such dignity. But just as St. Louis thought it had touched bottom (the city posted a tiny population gain in 2006, the first in half a century, up to 353,537), along comes another blow.

Anheuser-Busch, the St. Louis superbrewer, is the unhappy target of a $46.35 billion takeover attempt by InBev, a Belgian company run by Brazilian moneymen, which is the world's No. 1 beermaker -- its accumulated brands include Stella Artois, Beck's, Labatt and Bass. InBev is known for squeezing the fat from its acquisitions, and the people of St. Louis worry that the good jobs and corporate philanthropy Anheuser-Busch is known for will fall into the category of "fat."

"They're maybe the greatest corporate citizen this community ever had," says Al Hrabosky, a local celebrity whose biography is a testament to the omnipresence of A-B in St. Louis lives. Known as the "Mad Hungarian" for his antics on the mound, Hrabosky was a star relief pitcher for the St. Louis Cardinals back when the Busch family owned the storied ball club. (The two-year-old downtown ballpark is still known as Busch Stadium, though Busch sold the club in 1995.) "A-B brought me to this city, where I married a St. Louis girl, settled down and raised a family," Hrabosky explains. Today, Budweiser, Bud Light and Michelob flow abundantly at Al Hrabosky's Ballpark Saloon, and in his role as a Cardinals announcer on Fox Sports, Hrabosky frequently cuts to A-B advertisements.

You might say the fate of St. Louis was sealed when railroads replaced steamboats, but enterprise and good order kept the city chugging along through World War II. In 1950, it had a peak population of about 850,000 people and was home to such corporations as Ralston-Purina, May Department Stores and McDonnell Douglas.

Hemmed in by the often rivalrous St. Louis County, however, the city had no room to sprawl when Americans began their great migration to the suburbs. Within a couple of generations, St. Louis had lost more than half its residents, while the population of the surrounding county nearly tripled to more than 1 million residents. Meanwhile, most of the corporate giants had been gobbled up.

And now its weary residents are forced to contemplate a future without A-B.

The Brewery, as Anheuser-Busch is known around town, is not technically the biggest firm left standing; that honor goes to industrial conglomerate Emerson Electric. But it is certainly the most famous, an iconic American brand backed by one of the largest advertising budgets on earth. Nearly half of all American beer is brewed by A-B. Every time a radio ad for Bud or Bud Light ends with the words "St. Louis, Missouri," it's a shot in the arm for the hometown, which is why more than 45,000 people, including the mayor of St. Louis and the governor of Missouri, have already signed an electronic petition at SaveAB.com. "Like baseball, apple pie and ice-cold beer (wrapped in a red, white and blue label), Anheuser-Busch is an American original," the manifesto declares. (Tight-lipped A-B says it had nothing to do with the petition drive.)

A story in the St. Louis Post-Dispatch put it succinctly: A-B is "a symbol of the city on par with the Gateway Arch."

Anheuser-Busch is the legacy of an enterprising German immigrant named Adolphus Busch, who married the daughter of a middling brewer, Eberhard Anheuser, in 1861. Brewing the blond and foamy lager of his native land and seizing on the science of pasteurization, Busch "brought bottled beer to the masses," in the words of biographers Peter Hernon and Terry Ganey. At Busch's death in 1913, A-B was the biggest beermaker in the country -- a distinction the company never relinquished, despite a near death experience during Prohibition.

Descendants of the patriarch have run the company ever since -- while giving St. Louis its version of a lordly, extravagant and occasionally scandalous royal family. The company and the Busch family have spread their wealth across the community -- from the United Way to St. Louis and Washington universities; from the orchestra to the zoo -- a reported $10 million of local charity last year alone. Tours of the brewery are among the city's most popular tourist attractions, and every year hundreds of thousands of visitors enjoy the grounds of the family's estate, Grant's Farm, where children ogle the exotic menagerie while their parents sip free beer.

The latest clan member to run the firm is August A. Busch IV, who said earlier this year that the company will never be sold on his watch. Missouri governor Matt Blunt has denounced the takeover bid and Senator Claire McCaskill declared, after a visit from InBev boss Carlos Brito, that she would do everything in her power to block the deal.

It's not clear, however, whether anyone has that power. The sprawling Busch family is divided on the InBev offer, which at $65 per share is well above any price the long-stalled stock has seen from Wall Street. No single family member owns more than 1% of the firm.

Nor does the potential combination appear to trip antitrust alarms. InBev's business is primarily overseas, and the Bud brands would continue to face strong competition from the soon-to-be-merged Miller and Coors breweries. The story of this deal may ultimately come down to two words: money talks. (Muscular Euros, in fact, talk real loud these days.)

In the end, poor St. Louis may have to trust in InBev's promise to keep St. Louis as its North American headquarters and flagship brewery. As for the Clydesdales -- most of them moved to a farm in California years ago.