billionaire and Microsoft Corp. Co-founder Bill Gates continues to make waves with his latest venture into the beer industry. Gates made headlines by acquiring a substantial stake in Heineken Holding AG (OTC:HEINY), a Dutch company worth nearly $1 billion.
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The transaction, which took place on February 17, involved Gates buying 10.8 million shares worth $939.87 million, according to the filing by the Netherlands Authority for the Financial Markets (AFM). The acquisition coincided with a major sale of Heineken stock by FEMSA, the company’s largest Mexican shareholder. The timely investment comes shortly before the controversy surrounding Anheuser Busch (NYSE:BUD), meaning the billionaire could end up seeing a bump as Anheuser-Busch continues to slide.
Gates’ interest in Heineken comes as no surprise to those familiar with his previous beer-related investments. In 2007, Gates bought a stake in FEMSA for $392 million. But FEMSA sold its brewery to Heineken in 2010, leading Gates to redirect its investment to the Dutch brewing giant. Today, with its significant stake in Heineken, Gates is consolidating its position in the global beer market.
Despite his substantial investments, Gates has been open about his personal beer preferences. In a Reddit “Ask Me Anything” session, Gates wrote, “I’m not a big beer drinker. He shared that when he attends events such as baseball games, he opts for a light beer to blend in with other beer lovers, apologizing to the “true beer drinkers” who were expecting a different answer.
Anheuser-Busch InBev SA (AB InBev), owner of Budweiser, faces its own challenges. A boycott initiated by conservative activists has driven AB InBev shares down 15.39% over the past month. The decline wiped out more than $17 billion of the company’s market value.
According to May 30 reports, Bud Light sales had their worst week ever, dropping 25.7%. This follows a 24.6% decline the previous week and marks the sixth consecutive week of declining sales since Bud Light was endorsed by transgender influencer Dylan Mulvaney on April 1. According to Fox Business, the company’s market value fell by a total of $27 billion in stocks near a bear market.
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Although Gates is not a beer enthusiast, his strategic investments in the industry are attracting considerable attention. As Heineken deals with the FEMSA divestiture and Anheuser-Busch InBev deals with the repercussions of the boycott, it is clear that the beer industry is heavily influenced by constantly changing consumer sentiment and external factors.
Whether you’re a Heineken or Budweiser fan, a social drinker or a non-drinker, everyone can take inspiration from Gates and invest wisely.
The alcohol industry
Anheuser-Busch’s decline marks a stark contrast to other popular liquor brands right now. Many Budlights competitors are not only seeing a substantial increase due to the popular company’s decline, but have also seen massive stock spikes as a result of boycotts. For example, companies like Molson Coor Beverage Co. (NYSE:TAP) have risen 18% in the past 12 months, including a 15% rise in April alone. The company produces the popular “Coors” and “Molson” beer brands. In the same way, Miller Industries Inc. (NYSE:MLR) is up 36% over the past 12 months.
In the startup market, brands have also seen strong traction. For example, BarGlance is a nightlife tech startup that lets bar-goers see a “heat map” of their city’s bars and see the best bars in any city. The company has already seen considerable investment from retail 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 retail investors. Hercules Mulligan is approaching $500,000 raised from nearly 450 retail investors.
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This article Bill Gates Makes Billion-Dollar Bet on Heineken Ahead of Budweiser Controversy, Threatening Beer Giant’s Top Ranking, originally appeared on Benzinga.com
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