U.S. Sues to Block Big Beer Merger
on 01/02/13 at 10:03 amIndustry
The surprise lawsuit seeks to block Bud Light maker Anheuser-Busch InBev NV’s ABI.BT +4.01% deal with the Mexican company that owns the Corona brand, and comes just a day after concession talks with the government broke down.
U.S. authorities said they want to prevent any overcharging by the global giants that dominate mass-market brews.
Defenders of the companies said U.S. consumers have plenty of choice. Belgium-based AB InBev said the government’s action was “inconsistent with the law, the facts and the reality of the marketplace.”
Beer specialists were divided on whether the merger could survive, with some speculating that AB InBev could relinquish further control over Corona sales in the U.S. to assuage concerns about pricing dominance.
The suit caused a sharp drop in shares of AB InBev and its would-be merger partner, Grupo Modelo GMODELO.MX +0.45% SAB of Mexico. It hit shares of Constellation Brands Inc. STZ -0.90% even harder because the wine and spirits producer was set to expand as part of a side deal in the merger.