Bud Board to Go It Alone

Anheuser-Busch has no shortage of advisers working on the $46.4-billion takeover bid from Belgian brewer InBev. Reports indicate that Goldman Sachs, Citigroup, Merrill Lynch, and the law firm Skadden, Arps, Slate, Meagher & Flom are all on the case.

But do the independent members of Anheuser's board need their own sounding board? Apparently not. The group, which includes Edward E. Whitacre Jr., the former chairman of AT&T, and Douglas A. Warner III, the former chairman of JPMorgan Chase, have opted to go it alone, according to a story by The New York Times The decision could come back to haunt them, especially given the complex nature of the offer. Experts point out that what is in the best interest of the controlling Busch family could diverge from what is best for shareholders. Some lawyers say that in many situations the board needs its own counsel.

The argument against hiring independent deal guidance is that it could split the board and, as NYT's Andrew Ross Sorkin notes, multiple sets of advisers could create a conflicted record that could be used in potential lawsuits and independent advisers are usually the province of management buyouts.

Last year, various branches of the Bancroft family, which controlled Dow Jones, hired multiple advisers as they deliberated over News Corporation’s $5 billion takeover offer. That may have helped contribute to the fractious atmosphere that weakened the Bancrofts, who eventually conceded the fight to News Corp. and its chieftain, Rupert Murdoch, writes Sorkin.

Early indications are that the Busch family is leaning toward fighting the offer. If shareholders start to think that the Busch family is not acting in their best interest, the independent board members will feel the pressure to go against the family, which has two members on the board.