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Anheuser-Busch Agrees to Divest Its Modelo Beer Business in U.S.

Friday, April 19, 2013 18:16
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Anheuser-Busch Agrees to Divest Its Modelo Beer Business in U.S.

As part of a settlement agreement with the Department of Justice, Anheuser Busch (ABI) will divest itself of its Modelo beer business in the U.S.  The U.S. District Court of Washington, D.C. must still approve the settlement agreement.

The settlement agreement was the result of an antitrust lawsuit filed against the proposed $20.1 billion acquisition by ABI of the remaining assets of Mexican beer company Modelo thereby creating one company.  The lawsuit alleged the merger would diminish competition in the beer market in the U.S. and lead to higher beer prices.

The settlement agreement requires that ABI get rid of all of its Modelo beer licenses that include the following brands: Corona Extra, Corona Light, Modelo Especial, Negra Modelo, Modelo Light, Pacfico and Victoria.  ABI will also have to sell its Piedras Negras, Mexico brewery.  It is expected that competitor Constellation Brands will buy those assets from ABI.

Modelo is the third-largest beer seller in the U.S., with a seven percent nation market share.  Modelo’s Corona Extra is the top-selling beer imported in the U.S. 

ABI had a 35.3 percent stake in Modelo when it proposed buying 100% of the Mexican brewer.  Once the courts approve the settlement agreement ABI can proceed with the all-cash offer for the remaining shares of Modelo. 

Published in Latino Daily News



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