Strange Brew Merger

Given the credit crisis, InBev's acquisition of Anheuser-Busch might be one of the last huge mergers for a while. The deal has solid financing behind it—highly unusual in the current climate—and debt isn't likely to be a big problem for the combined companies.

But that doesn't mean things will be easy. As the companies work to make their huge and disparate operations work together, they are facing increasing costs and softening demand in key markets.

InBev said on Friday, though, that it expects its worldwide sales to rise a bit in its third quarter, thanks in part to growth in Latin America, even as sales continue falling in Europe and elsewhere, particularly in Russia. The company said, however, that it expects margins to sink overall.

Busch, meanwhile, said price increases are being swallowed by North American drinkers, and so it also expects sales to rise. And while its new Bud Light Lime may sound to some of us like a particularly foul concoction, Busch expects it to help boost margins.

But Busch also said that overall margins will be squeezed in the third quarter. Its prediction that costs will ease in the fourth-quarter thanks to lower commodity prices might not much better than guesswork, however, given the deep uncertainty of global grain markets.