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Modelo CEO Resigns from Anheuser-Busch Board

Reuters
Friday, 20 Jun 2008 | 10:38 AM ET

Anheuser-Busch said Friday that Carlos Fernandez, chairman and chief executive of Mexican brewer Grupo Modelo, has resigned from the U.S. brewer's board of directors.

AP

Anheuser-Busch , which owns 50 percent of Modelo, is currently weighing a $46.3 billion takeover bid from Belgian-Brazilian brewer InBev.

A Modelo spokesman declined to comment on the resignation.

The Wall Street Journal has reported that Anheuser-Busch has begun talks with Modelo, Mexico's top brewer and maker of Corona beer, about a possible combination of the two companies that could help it thwart the InBev bid by making Anheuser too big to swallow.

Meanwhile InBev is also believed to have reached out to Modelo, according to a source familiar with the situation.

Modelo is family run, and analysts have said it seems unlikely that the family voting trust, controlled by Fernandez's uncle and the family patriarch, Antonino Fernandez, would sell out to Anheuser-Busch.

InBev Will Keep US Anheuser Breweries

On the other side of the Atlantic, InBev said its $46 billion bid for Anheuser-Busch would not lead to U.S. brewery closures and some of the U.S. firm's top management and board members would be retained after the planned merger.

Bud Developments
Grupo Modelo chairman/CEO Carlos Fernandez resigns from Anheuser board, reports CNBC's David Faber

"The combination would try to retain top management from both companies and board members from both," Carlos Brito, Chief Executive of Belgium's InBev, said in a video interview released to the media on Friday.

"There would be no brewery closures (in the United States)," he said.

A deal would fuse the second- and fourth-largest brewers to overtake world leader SABMiller, and create a combined company that brews three of the top four beers in the world -- Bud Light, Budweiser and Skol.

"What's important here is that Budweiser the beer will continue to be brewed in the same breweries," Brito said.

"What we are trying to do now is engage with their board," he added.

"At the end of the day what we are proposing is a culture of high performance and common sense," Brito said.

Brito is no stranger to the Budweiser brand.

"When I am in Canada I drink Bud," Brito said, adding that when at home he opted for InBev's Stella Artois.

InBev distributes Budweiser in Canada through its Canadian unit Labatt.

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