Bud Merger And The Possible UFC Effects
July 15, 2008
After an extended negotiation process it looks like Euro brewing giant InBev will gobble up Anheuser Busch. Amy Robinson at MMAOpinion speculates at the possible impact the move may have as it relates to Bud Light’s sponsorship deal with the UFC:
The greatest concern for the UFC, as stated by many financial experts is how exactly InBev will be able to cover the $70 a share stock price, which is a huge increase from the $52 a share that Budweiser had been stuck at for a year. The general understanding is that massive cuts will have to be made by Inbev to cover the high cost. Budweiser’s massive arsenal of sports sponsorships would almost certainly be one of the first expendable areas to be on the chopping block, which would be a huge blow to the UFC.
While the possibility of cuts in sponsorship can be debated, when such mergers take place all bets are off as to how various ancillary agreements may be affected. Those among us who are pro wrestling fans will remember the AOL-Time Warner merger that essentially shuttered WCW, and forced a sell off to Vince McMahon’s WWE.
The merger may even turn out to benefit the UFC. With the inclusion of InBev into the mix, the UFC may have a partner to assist them in penetrating the mainland European market. The UFC could use promotional tie-ins with such InBev brands like Beck’s in Germany and Stella Artois in the UK as well as a host of other localized brands in the InBev family to raise the UFC’s profile in the Old Country, similar to to their deal with Bud Light in the US.
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