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Florida Governor Ron DeSantis Launches Investigation into Bud Light Parent Company
Reviewing AB InBev's Conduct
Florida Governor Ron DeSantis has directed the State Board of Administration to investigate whether AB InBev, the parent company of Bud Light, breached its duties to shareholders. This move comes as conservative backlash continues to grow over Bud Light's recent partnership with transgender social media influencer Dylan Mulvaney. Governor DeSantis has stated that it appears AB InBev may have violated its legal obligations to shareholders, and he believes a shareholder action may be necessary.
Impact on Share Value
Governor DeSantis is concerned about how AB InBev's conduct has affected the value of the State Board of Administration's holdings. He believes that the declining sales and boycott of Bud Light following the Mulvaney partnership may have contributed to a decrease in the company's stock value. Shares of AB InBev have dipped by about 2% this year, while the overall market has seen gains. Governor DeSantis has emphasized that all options are on the table.
Bud Light's Sales Decline
Data from consulting firm Bump Williams reveals that Bud Light has experienced a significant drop in sales since the partnership with Dylan Mulvaney. The beer brand lost its top spot in the U.S. beer market to Constellation Brands' Modelo Especial. Bud Light currently holds 7% of overall beer sales, while Modelo Especial holds 8.7%. This decline in sales has led to a 25% decrease in Bud Light's sales compared to last year. In response to the boycott, AB InBev's stock fell from $66 to $58 per share.
Possible Lawsuit and Accusations
Governor DeSantis suggests that the investigation could result in a lawsuit on behalf of Florida's pension funds shareholders. He believes that there should be penalties for a company that prioritizes its social agenda over the well-being of hardworking individuals. DeSantis accuses AB InBev of neglecting its stakeholders and pensioners by associating with "radical social ideologies." As the trustee overseeing the state board, along with the state's attorney general and chief financial officer, DeSantis has the authority to initiate such actions.
DeSantis's History of Involvement in Controversies
This move by Governor DeSantis follows his previous involvement in contentious social issues. He has been engaged in a heated dispute with Disney, one of Florida's top employers, over the past year. DeSantis has criticized Disney for criticizing Florida's bill that limits discussions of gender identity in classrooms. The governor has also intensified his attacks against entities that he believes promote progressive political ideology. He sees it as his duty to manage Florida's funds wisely, focusing on financial returns rather than supporting woke virtue signaling.
Rebooting the Campaign
Governor DeSantis is currently trailing former President Donald Trump by double digits in national GOP primary polls. As a result, his campaign is planning a reboot less than two months after entering the race. The governor aims to close the gap and regain momentum as he competes against Trump for the Republican presidential nomination.
Mulvaney's Experience and Criticism
Transgender social media influencer Dylan Mulvaney has expressed disappointment in Bud Light for not standing by her during the boycott. Mulvaney has faced harassment, public ridicule, and a sense of loneliness as she has become the face of the controversy. She hopes that her experience will shed light on the challenges faced by transgender individuals and garner support for greater understanding and acceptance.
Conclusion: Potential Impact on a New Business
The investigation launched by Florida Governor Ron DeSantis into AB InBev, the parent company of Bud Light, has sparked controversy and raised questions about the impact on businesses navigating the current social landscape. With conservative backlash growing over Bud Light's partnership with transgender social media influencer Dylan Mulvaney, this situation serves as a cautionary tale for new businesses seeking to make strategic partnerships.
One key lesson from this case is the importance of carefully considering the potential consequences of aligning with controversial figures or social causes. The decline in Bud Light's sales and the subsequent dip in AB InBev's stock value highlight the potential risks of alienating certain consumer segments. Businesses should conduct thorough market research and assess the potential impact on their target audience before entering into partnerships or endorsing causes that may attract backlash.
Moreover, Governor DeSantis's move to investigate AB InBev's conduct demonstrates the complexity of operating in a politically charged climate. It emphasizes the need for businesses to be aware of the political and social environment in the regions where they operate. Understanding local sentiments and potential political ramifications can help businesses navigate potential risks and make informed decisions.
In conclusion, the Bud Light controversy serves as a sobering reminder that businesses must carefully evaluate potential partnerships and consider the wider social and political implications. Making well-informed choices, understanding the consequences, and staying attuned to the preferences of their target audience will be crucial for new businesses seeking success in today's complex landscape.
Article First Published at: https://www.cnbc.com/2023/07/21/desantis-orders-probe-into-bud-light-dylan-mulvaney-deal.html