St. Louis: A good place to close a business

July 14th, 2008

With today’s news confirming InBev’s acquistion of Anheuser-Busch St. Louis has lost another business headquarters and one of the defining icons of the city as well. At $70 a share the stockholders will reap a tidy profit but at what cost? As little as a year ago AB was trading at $45 a share which means that had you purchased at that time you would have realized a nearly 60% return on investment today. But is it worth it? InBev has announced that it plans to slash $1.5 billion in operating costs over the next 3 years which probably means that many of St. Louis’s 6000 AB employees will lose their jobs. Efficiency is the name of the game though and this is not the only time this has happened in St. Louis. A look at the recent business history:

A.G. Edwards was acquired by Wachovia which did end up relocating jobs here from Charlotte, NC but many other jobs were slashed.

May Department Stores was acquired by Federated (Macy’s) who eventually shut down operations in St. Louis and took 1700 jobs with them.

TWA was acquired by American Airlines who cut thousands of jobs and plenty of flights. This is the reason you now have a layover in Columbus in order to fly to Denver (an exaggeration but not by much). This one pisses me off the most.

McDonnell-Douglas was acquired by Boeing. This one wasn’t necessarily bad for the city unless you count losing the prestige of a corporate headquarters. Boeing still employs over 15000 employees here and it’s still a place I can routinely threaten to leave my job for.

Recent rumors/minor concerns:

International Bowling Hall of Fame is heading to Arlington, TX is the next year. Now I’ve never been to this place and it’s always gotten ridiculed by visitors to the city but I don’t like to see it go. Especially since it’s leaving to make way for the perpetually delayed Ballpark Village project AKA the St. Louis Cardinals version of suburban living in the city!

St. Louis Rams are going to be sold. Chip Rosenbloom inherited the team after his mother Georgia Frontiere passed away. Rumors persist that the team might be moved back to LA after their lease expires in 2015. A new stadium is probably necessary to keep the team here. Rosenbloom has no interest in running the team as he’s off producing B-movies in LA.

These are bleak times for St. Louis business.