From two rival families to a global brewing giant - new book tells the history of AB InBev

Belgium is the birthplace of the world’s biggest and most powerful brewery – and a newly published book tells the story of how two small Belgian family businesses came to take over the global brewing industry.

Becoming the World’s Biggest Brewer: Artois, Piedboeuf, and Interbrew (1880-2000) charts the history of what is now AB InBev, by far the biggest industrial player since InBev’s absorption of Anheuser-Busch in 2008.

The story starts with two Belgian breweries, Artois in Leuven and Piedboeuf in Jupille, near Liège. Artois created the beer Stella in 1926, which became the leading Belgian beer after the second world war. Then Piedboeuf created Jupiler in 1966 and wrested the crown from Artois. Their rivalry was legendary.

The book was researched and written by four university researchers and professors, Kenneth Bertrams and Julien del Marmol from the ULB and Sander Geerts and Eline Poelmans from KU Leuven. With the help of a representative from each family of Belgian shareholders, they completed this gargantuan task through numerous interviews for first hand accounts, and the sharing of archives and historical documents.

“We could have opted for a purely historical story of the firms Artois and Piedboeuf,” the researchers write in the book’s introduction. “Instead we describe how two small-scale players became a world class giant, by focusing on the family histories, the multigenerational dimensions that created the unique dynamics: the evolution of family capitalism, globalisation and consolidation.”

Along the way we are taken on a historical tour of the hows and whys of the evolution of Belgian beer which led to the extraordinarily wide variety of beers brewed in Belgian, a breadth of types unique in the world.

The Bulletin spoke to Kenneth Bertrams, one of the four authors, a professor at ULB, where he teaches economic history and the history of science. “It’s a story about families, two Belgian, one Brazilian and one American and to what extent they were willing to go to become industry leaders,” he says.

Tell us about the ‘secret deal’

"In 1971, Piedboeuf and Artois, famous for the intense rivalry between Stella and Jupiler, entered into a secret deal in which they merged but no one except a few members of the families and some of the shareholders knew about it. The middle and lower management as well as most of the upper management and most definitely the consumer had no idea that the families had merged and everyone still believed they were great rivals. Why do this? Because they realised that they needed each other to keep growing. The rivalry propelled sales, but at the same time they wanted to maintain their autonomy and their very different brewing culture. This lasted for 16 years until 1987."

What happened to end the secret?

"In 1987, a man was arrested at Zaventem, getting off a plane from Africa. He had a cache of diamonds hidden on him as well as an address book that included the name of a member of the Artois family. A tax investigation was launched and in the course of it the secret deal was revealed and the investigators uncovered not exactly tax evasion but a very creative way to repatriate revenues from their beer sales in Africa."

What will the future of AB InBev bring?

"That’s a big question. On the one hand, beer sales have stagnated in the past decade but on the other there has been a sharp increase in the number of microbreweries, which is interesting because it’s a return to the previous era of beer production in the late 19th and 20th century when Belgium was home to more than 3,400 breweries (now the number stands at 300).

"It seems that one of the current strategies is to let this market grow but also participate in it as the recent purchase of Ginette Beer, a very small-scale but very high-quality brewery, by AB InBev attests. It will be interesting to see what happens as the management continues its long history of reinventing itself with some of the recipes for reinvention being quite historical."

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