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Carlos Brito, who left office Anheuser-Busch InBev this week at the age of 61, he is already planning a second long event. “Brito 2.0” could involve a quarter of a century of work, said the Brazilian businessman who spent three decades at the brewery.
“My father… Was a vascular surgeon until he was 86…. I’m 25 years ahead, at least 25 years,” he said.
Brito built AB InBev from a Latin American regional player to the world’s largest brewing company, with brands such as Budweiser and Stella Artois.
But his final years were overshadowed by his largest and most controversial deal, the acquisition of £ 79 billion from rival SABMiller in 2016. The share price of AB InBev is more than 45 per cent below where it was when this deal was completed, and is still covered with $ 83. thousands of debt.
AB InBev’s aggressive negotiation defined an era of consolidation that consolidated the dominance of a handful of global brewers. Brito he leaves the company – and the industry – has been transformed since it joined what was then Brahma in 1989.
Bernstein analyst Trevor Stirling called him “one of the three titans who have shaped the modern brewing industry,” alongside former Heineken chief Jean-François van Boxmeer and late SABMiller leader Graham Mackay.
In many ways, the Wall Street view on BritoThe legacy is in line with that of the former chief executive. “We started from a Latin American country, a European country and built a world brewery. . . one of the first three GPCs [consumer packaged goods] companies in the world and the highest in profitability, ”he said.
“It has clearly created a lot of value for its shareholders,” Stirling agreed.
With AB InBev meeting in the face of the worst of the pandemic, it was reported much better than expected first quarter results – Brito has handed over the reins to Michel Doukeris, a 25-year veteran of the company known for building digital brands and sales.
“He is very competent; he is better than me, ”Brito said, citing his successor’s successes in Mexico, Brazil, China and the United States.
Doukeris’ professional career reflects AB InBev’s evolution towards a truly global company, which Brito argued would not have happened without the SABMiller agreement. “It was right,” he said, for a brewer who thinks “not just in the next few years, but in the next 50 and 100 years.”
But he admitted that Covid-19 had withdrawn AB InBev’s debt reduction plans for about two years, and preferred to highlight the hostile acquisition of Anheuser-Busch in 2008.
This offer came just before the global financial crisis hit. “We needed ten banks on the closing date to reach a couple of million dollars each and some banks just disappeared every day,” he recalled. But once AB InBev got that funding, “we never looked back.”
The era of making megadeals is over, Brito acknowledged, although small-scale recruitment continues. This, according to analysts, put more pressure on AB InBev to create brands and grow organically, although its scale has not always helped its agility.
One example is hard seltzer, the flavored alcoholic carbonated water that has taken over the beverage market in the United States. In 2016 AB InBev acquired the pioneering brand, SpikedSeltzer, to be overtaken by new rivals White Claw and Truly; it still lags behind these brands, despite gaining market share this year, according to Bernstein.
“I think sometimes, maybe, it took us longer to accept some changes,” Brito admitted, because the size of the company made him wary of cannibalizing its huge existing profit engines.
Without acknowledging that the U.S. beer market is in decline, he predicted that non-beer products like hard seltzer will grow in importance. “What people call the fourth category, which is the blurring of beer, wine and spirits. . . endanger[s] a section of existing categories, inherited categories “.
General executives ’expectations evolved as rapidly as consumer habits during Brito’s reign, but he said AB InBev would not be“ an activist company, ”campaigning on issues outside its core competence.
“The biggest challenge today [is] that people believe that CEOs and companies need to have an opinion on everything, ”he lamented.
Investors ’new focus on environmental, social, and governance concerns, or ESG, may seem an awkward fit with AB InBev’s zero-budget embrace. Still, Brito painted the system with 3G Capital support, in which all costs have to be justified again in each budget period as a greener company.
“Everyone. . . it wants companies to manage waste in a way that minimizes the impact on the planet. So, suddenly, efficiency became an interesting thing, ”he said.
Companies now needed to understand that their communities “only allow you to exist if you are part of the solution,” he said. we will restrict your business ”.
Brito urged governments not to raise taxes on companies like his to pay their Covid-19 disbursements, but to impose the burden on those who benefited from the pandemic.
“When they raise taxes to pay Covid incentives and stuff, they should go looking for companies that need to share their wealth because they have consumers who pushed them,” he said. Some companies tripled or quadrupled their market value: “We didn’t.”
Brito has not yet agreed on his next step, but did not rule out another CEO role, nor return to work with his mentor, 3G co-founder Jorge Paulo Lemann, who funded his training and he hired banking at the age of twenty.
The calls Brito received after announcing his departure suggested he would have “many options,” he said, and planned to spend July and August returning them.
But he expressed little doubt that this was the right time to give up the company he formed. “We have to pass the baton on to a new generation, otherwise they will leave for another place,” he said. “If the CEO stays forever, the machine doesn’t work.”
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