Altria Group Inc (NYSE:MO) didn’t make any major acquisitions again until 1985, when it bought General Foods in what was at the time the costliest non-oil merger in American corporate history. This was the same year that Altria Group Inc (NYSE:MO) joined the Dow Jones Industrial Average, replacing one of its fiercest industry rivals. Altria’s net income grew from $49 million in the year before its purchase of Miller to $889 million the year before it joined the Dow — an annualized growth rate of 19.9%.
Altria eventually sold its majority stake in Miller to South African Breweries in 2002, creating SABMiller plc (LON:SAB) in the process, but the tobacco company retains about a quarter of the megabrewer to this day. That stake was worth $21.25 billion on the 44th anniversary of Altria’s original purchase, which means that Miller has given Altria an annualized 14.1% rate of return for more than four decades of ownership — keep in mind that Altria’s current stake is only about half as much of Miller as it bought in the 1969 acquisition. Not bad for a long-term investment, wouldn’t you say?
The article One Business Empire Lights Up After Another Is Blown to Bits originally appeared on Fool.com.
Fool contributor Alex Planes has no position in any stocks mentioned. The Motley Fool recommends PepsiCo. The Motley Fool owns shares of PepsiCo.
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