A rose by any other name may still smell as sweet, but does a beer called "Budweiser" that's not brewed by Anheuser-Busch InBev (NYSE:BUD) still quench your thirst the same? Depends on where you're drinking it.
First introduced in 1876 by Adolphus Busch, Budweiser has become one of the biggest-selling beers in the world, with an 8% share of the U.S. market all by itself, while globally it accounts for 9.2% of the brewer's total volumes and represents over 51% of global Budweiser volume on sales outside of the U.S. According to Interbrand's 2013 survey of the "100 Most Valuable Brands," Budweiser ranks 31st, with a value worth more than $12.6 billion, up 6% from the year-ago tally.
Yet A-B's Budweiser is not the only beer sold by that name. In fact, there are two others, and their history extends back at least as long as their U.S. rival's does. For the past 100 years or so, however, there's been an uneasy detente between them that's only recently been broken, and to help strengthen its claim to the Budweiser name, Anheuser-Busch just bought one of its rivals.
Ceske Budejovice, or "Budweis" in German, is a city of 96,000 people in the Czech Republic that has a brewing tradition stretching back to the 13th century, when it was part of Bohemia. Something or someone from the city is called a Budweiser, and in 1795 town officials established the Burgerliches Brauhaus Budweis. A hundred years later its Budweiser Burgerbrau became the official beer of the German state of Wurttemberg and it began exporting its beer to the U.S. in 1871. That led Adolphus Busch to start using the Budweiser name five years later, and he registered its name in 1878.
The popularity of the beers, however, inspired other Budweis locals to found the competing Budweiser Budvar Brewery in 1895, and they also began exporting Budweiser beer, as it signified beer originating from the city. But with three beers from different brewers all being called "Budweiser," a trademark dispute erupted some 30 years later, in 1907, that led to a formal agreement wherein Anheuser-Busch was able to market its beer as Budweiser only in North America.
Yet over the years the U.S. brewer has attempted to gain global control of the trademark. Far more often than not it has been rebuffed by the courts, with Budvar usually coming out on top. Just last week it lost a decision in Portugal to register its beer under the Budweiser name in the country.
Still, as A-B sought broader rights to the name, it acquired some Budweiser trademarks in Europe from Burgerliches Brauhaus Budweis, which by then had been renamed First Budweiser Brewery Samson. But it didn't buy Samson's brewing facilities, an oversight that it rectified Wednesday with its purchase for an undisclosed sum.
Anheuser-Busch believes that owning two-thirds of the brewers making Budweiser beer will give it greater clout in court, though Budvar disputes the notion, telling The Wall Street Journal, "The ownership change [of Samson] has no relevance on [Budweiser] trademarks and ongoing court cases between Budejovicky Budvar and A-B InBev."
So this holiday weekend, if you find yourself asking for a Budweiser, you may just need to check whether it's an Anheuser-Busch Budweiser, a Budvar Czechvar, or a Samson B. B. Burgerbrau, all of which mean the same thing.
Rich Duprey has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.