InBev slashes US workforce a month after completing Anheuser-Busch buy
09 Dec 2008
Anheuser-Busch InBev plans to cut 1,400 salaried workers in its beer-related divisions, or around 6 per cent of the company's US work force, the world's largest brewer said yesterday. Some field offices and brewery locations will also feel the axe while 250 open positions will not be filled and 415 contractor jobs will be eliminated.
Coming less than a month after Belgian-Brazilian InBev completed its acquisition of American Anheuser-Busch, these cuts may stir up a controversy.
About 75 per cent of the affected workers, or 1,050, are based in St. Louis or its Sunset Hills campus. Most are engineers, information technology workers and other corporate positions. Most of the job cuts will occur by the end of the year, with the remainder scheduled for 2009.
Anheuser-Busch InBev will provide employees severance pay and pension benefits based on age and years of service. Employees also will be offered outplacement services. The Budweiser maker said it expects $197 million in pretax expense related with the reduction.
These job cuts are in addition to the more than 1,000 US. salaried employees companywide who accepted the company's buyout and retirement offers. Most of those workers and the unfilled positions are based in St. Louis, bringing the total number of local salaried jobs eliminated to 2,300. That's nearly 40 per cent of the brewer's St. Louis work force of 6,000.
The retirements and job cuts have been described as ''an integral part of'' the brewer's plan, dubbed Blue Ocean, to cut $1.5 billion in costs. The plan, announced in June, includes reducing the company's full-time salaried workforce of 8,600 by 10 to 15 per cent before the year end. The company said that it is confident it will deliver on the $1.5 billion target in annual cost cuts by 2011.
"These decisions are a result of a careful review of each department," company President Dave Peacock wrote to employees in a memo Monday. "As expected, there are overlapping functions and synergies gained through the merger, which have driven part of these reductions. Others are the result of ongoing efficiency improvements and additional cost-reductions, including lower capital expenditures.
These were not easy decisions but were necessary for the organisation."
