Friday, March 22, 2013

Anheuser-Busch InBev Pronounces Progress in DOJ Suit

Citing significant progress made in joint talks over its proposed acquisition of Grupo Modelo, brewing giant Anheuser-Busch InBev (NYSE: BUD  ) said all the parties, including the Justice Department,jointly asked the court to extend a stay due to expire March 19, as they will probably complete their negotiations.

Anheuser-Busch, which is trying to acquire the remaining 50% stake in the Mexican brewer it doesn't already own for $20.1 billion,�originally agreed to sell Modelo's existing 50% interest in�Crown Imports to co-owner Constellation Brands (NYSE: STZ  ) , but the FTC objected because of antitrust and anti-competitiveness concerns.

AB InBev subsequently modified the proposal and agreed to sell Compania Cervecera de Coahuila,�Grupo Modelo's brewery in Piedras Negras, Mexico, and grant perpetual brand licenses to Constellation for $2.9 billion.�Modelo's U.S. business would be completely divested to ensure independence of supply for Crown Imports. It would also provide Constellation with complete control of the production of the Modelo brands for marketing and distribution in the United States.

AB,�Grupo Modelo, Constellation, Crown, and Justice have been in discussions to resolve the antitrust concerns. They requested that the court extend the stay until April 9.�If the parties reach an agreement, they will file a proposed consent judgment and related documentation with the court, though Anheuser-Busch InBev offers a reminder that it cannot guarantee the discussions will be successful.�

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