Corona-Bud revise deal to appease regulators

NEW YORK — Anheuser-Busch InBev changed the terms of its proposed $20.1 billion acquisition of Mexican brewer Grupo Modelo on Thursday in an attempt to push through a deal that federal regulators say will kill competition.

AB InBev is willing to sell Modelo’s Piedras Negras brewery and give perpetual rights for Corona and the Modelo brands in the U.S. to Constellation for $2.9 billion, the company said Thursday. The brewery, which currently makes Corona, Corona Light and Modelo Especial, will give Constellation total control over the production of Corona and Modelo in the U.S.

Under previous terms of the complicated deal, Modelo would sell its half of Crown Imports to wine maker Constellation Brands Inc. to address antitrust concerns, but InBev maintained the right to end an import agreement with Crown Imports, and that was to be exercisable every 10 years.

Regulators are leery of the tie-up because AB InBev and Modelo control about 46 percent of annual U.S. sales.

Justice Department spokeswoman Gina Talamona said in a statement that the department can’t comment on a specific proposal, but that it “would give any proposal serious consideration and at the same time we would continue to prepare for litigation.”

Anheuser-Busch was purchased by Belgium’s InBev in 2008. The combined company is already the world’s biggest brewer and makes Budweiser, Beck’s and Stella Artois, among others.

Last month the Justice Department filed a lawsuit to block the deal, saying that one company controlling nearly half of all U.S. beer sales would stifle competition and increase prices.

On Thursday, AB Inbev said the sale of the brewery which supplies the domestic market would give Crown total control over supply.

“We believe this revised agreement addresses all of the concerns raised by the U.S. Department of Justice in its lawsuit, leaving no doubt about Constellation’s Crown beer division’s complete independence and ability to compete,” InBev said in a statement released Thursday.

AB InBev rose $5.16, or 5.9 percent, to $93.42 in morning trading Thursday, while Constellation jumped $10.93, or 34.3 percent, to $42.81.

Constellation’s stock hit an all-time high of $44 earlier in the session.

More in Herald Business Journal

Nordstrom suspends buyout after struggling to get financing

A buyout was meant to help the company continue turnaround efforts outside the glare of market scrutiny.

More self-awareness could help build a better medical system

Marcy Shimada of Edmonds Family Medicine writes the second in a series about fixing our health care system.

Justices to hear government’s email dispute with Microsoft

A lower court ruled emails in a drug case couldn’t be searched because they were in Ireland.

Bombardier to partner with Airbus on C Series program

The move by Bombardier could possibly circumvent duties being imposed on the C Series.

Everett’s Access Laser sells majority stake to German company

Everett firm with 50 employees makes lasers for scientific, medical fields and self-driving vehicles

Innovation Resource Center’s advice for budding inventors

Got the next great idea? The Buildit NOW program stands ready to help you.

Mountain Pacific Bank to host Economic Forum in Everett

Mountain Pacific Bank’s Economic Forum is from 7:30 to 9:30 a.m. Wednesday… Continue reading

Career-community resources fair planned this week at EdCC

Edmonds Community College will host a free fall quarter career fair featuring… Continue reading

Most Read