LABATT AND ANHEUSER SIGN LIFETIME AGREEMENT
By Adnews Staff
Toronto-based Labatt Breweries of Canada and U.S.-based Anheuser-Busch have restructured their 18-year alliance so that the two companies will be working together forever. Until now, there was a clause in the contract which would have allowed either company to opt out of the deal. In exchange for the perpetual rights to the Anheuser's Budweiser and Bud Light brands in Canada, Labatt will increase marketing support behind the two brews and provide Anheuser-Busch with a greater share of the associated profits. Labatt spokesperson Bob Chant wouldn't comment on how much advertising would be increased for the beer. Canadian advertising for Anheuser-Busch brands is created by Bozell Worldwide of Toronto. Labatt and Anheuser-Busch established their first licensed brewing relationship in 1980, with Labatt brewing, distributing, marketing and selling Budweiser beer in Canada. The deal was later extended to include Bud Light. Labatt currently imports and distributes other Anheuser-Busch brands in Canada including Busch, Busch Light and Michelob. "This agreement allows Labatt to make a greater investment in our long term future with Budweiser in Canada," Labatt CEO Hugo Powell says in a release. "Our local brewing alliance with Labatt was our first in the international marketplace," Anheuser chairman and president August Busch says in a release. "This new agreement commits both companies to moving into the future together and demonstrates our complete confidence in Labatt's support for our brands. The new agreement goes into effect retroactively as of Jan. 1, 1998.