A-B InBev Begins Talks With DOJ Over Modelo Deal
WASHINGTON, D.C. -- Anheuser-Busch InBev and the U.S. Department of Justice (DOJ) are in talks to resolve anti-trust concerns swirling around A-B InBev's $20-billion deal to purchase the 50 percent of Grupo Modelo S.A.B. de C.V. it doesn't already own.
The DOJ filed suit at the end of January challenging the deal, as CSNews Online previously reported. However, on Wednesday, all sides involved jointly requested a temporary stay of all litigation proceedings until March 19 while they try to reach an agreement, according to a statement from A-B InBev.
In June, A-B InBev revealed its deal with Grupo Modelo, the Mexican-based brewer of Corona, Modelo and Pacifico beers. At the time, A-B InBev said the acquisition was a "natural next step." The combined company would have operations in 24 countries, 150,000 employees and 2012 estimated revenues of $47 billion.
However, the federal government raised anti-competitive concerns in a Jan. 31 lawsuit and moved to block the sale. When it comes to ranking, A-B InBev is the largest beer company in the United States, followed by MillerCoors at No. 2 and Grupo Modelo at No. 3.
The deal took another turn last week when A-B InBev revised its agreement to pick up the remaining 50 percent of Grupo Modelo. Under terms of the revised agreement, once the transaction is complete, A-B InBev would sell its full U.S. Grupo Modelo interest to Victor, N.Y.-based Constellation Brands Inc. A-B InBev also would sell Compania Cervecera de Coahuila, Grupo Modelo's brewery in Piedras Negras, Mexico, as CSNews Online previously reported.