billionaire and microsoft corp Co-founder Bill Gates continues to make waves with his latest foray into the beer industry. Gates made headlines by acquiring a sizable stake Heineken Holding NV (OTC:HEINY), a Dutch company valued at nearly $1 billion.
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In the transaction, which took place on Feb. 17, Gates acquired 10.8 million shares worth $939.87 million, according to the Dutch Financial Markets Authority (AFM) filing. The acquisition coincided with the significant sale of Heineken stock by FEMSA, the company's largest Mexican shareholder. The timely investment comes just a short time before the controversy surrounding them Anheuser-Busch (NYSE:BUD), meaning the billionaire could end up seeing a surge as Anheuser-Busch continues to slide.
Gates' interest in Heineken comes as no surprise to those familiar with his past investments in beer. In 2007, Gates acquired a stake in FEMSA for $392 million. But in 2010, FEMSA sold its brewery to Heineken, prompting Gates to redirect its investment in the Dutch brewing giant. With its significant stake in Heineken, Gates is now consolidating its position in the global beer market.
Despite his significant investments, Gates has been open about his personal preferences when it comes to beer. In a Reddit session “Ask Me Anything,” Gates wrote, “I'm not a huge beer drinker.” He shared that when he attends events like baseball games, he chooses light beers to mingle with other beer lovers, and apologizes with “real beer drinkers” who might have expected a different reaction.
Anheuser-Busch InBev SA (AB InBev), the owner of Budweiser, faces its own challenges. A boycott initiated by conservative activists caused AB InBev's stock to fall 15.39% over the past month. The decline wiped out over $17 billion of the company's market value.
According to reports on May 30th, Bud Light sales had their worst week ever, plummeting 25.7%. This follows a 24.6% drop in the previous week and marks the sixth straight week of falling sales since transgender influencer Dylan Mulvaney endorsed Bud Light on April 1. According to Fox Business, the company's market value is down a total of $27 billion judging by shares near a bear market.
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Though Gates isn't a beer lover, his strategic investments are gaining popularity in the industry. As Heineken deals with the divestiture of FEMSA and Anheuser-Busch InBev deals with the fallout from the boycott, it is evident that the beer industry is heavily influenced by ever-changing consumer sentiment and external factors.
Whether you're a Heineken or Budweiser fan, a social drinker or a non-drinker, everyone can be inspired by Gates and invest wisely.
The alcohol industry
The demise of Anheuser-Busch represents a stark contrast to other currently popular alcohol brands. Many of Budlight's competitors are not only experiencing significant gains due to the demise of the popular company, but also saw massive stock gains following the boycotts. For example, companies like Molson Coor Beverage Co. (NYSE:TAP) are up 18% over the past 12 months, including a 15% rally in April alone. The company produces the popular Coors and Molson beer brands. Similar, Miller Industries Inc. (NYSE:MLR) is up an incredible 36% over the past 12 months.
Brands have also gained a lot of traction in the start-up market. For example, BarGlance is a nightlife tech startup that allows bar-goers to view a “heatmap” of the bars in their city and see the best bars in each city. The company has already seen significant investment from private investors.
On platforms like StartEngine, alcohol is one of the most popular investments. Island Brands, for example, has raised over $1.6 million from over 1,350 investors. Copperworks Distilling Company has raised over $398,000 from 212 individual investors. Hercules Mulligan has raised nearly $500,000 from nearly 450 individual investors.
For more information, see startup investments by Benzinga.
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This article, in which Bill Gates makes a multi-billion dollar bet on Heineken threatening the beer giant's top spot just before the Budweiser controversy, originally appeared on Benzinga.com
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