Anheuser-Busch InBev N.V. (NYSE: BUD) may yet buy Mexican brewer Grupo Modelo, despite early resistance from the U.S. Department of Justice. To close a transaction, the larger company probably will offer terms that DOJ will find more palatable.
According to Reuters:
The DOJ was not convinced that AB InBev's related plan to sell its 50 percent share of U.S. beer importer Crown Imports to the world's largest wine company Constellation Brands (STZ) would have remedied that defect, since AB InBev would still have supplied Crown with Corona and other Modelo beers and had the option every 10 years to buy the whole of Crown.
AB InBev said on Thursday it had now agreed to sell Modelo's Piedras Negras brewery next to the U.S. border to Constellation and grant it perpetual rights for Corona and other Modelo brands in the United States, at a cost of $2.9 billion.
The U.S. beer market is currently dominated by AB InBev and MillerCoors, a joint venture between SABMiller (SAB.L) and Molson Coors Brewing Co with a 30 percent share.
Filed under: 24/7 Wall St. Wire, Mergers and Buy Outs Tagged: BUD