Belgium-based Anheuser-Busch InBev – which produces global lager Budweiser – was brewing up a $20 billion-plus purchase of Mexico’s Modelo, which manufactures Corona Extra.

Public interest

But the US Justice Department has jumped into spoil the party, according to the National Law Journal, with its competition lawyers launching proceedings to put a brake on the deal. The report says the proposed purchase would give Anheuser – which already has a 20 per cent stake in Modelo – control over nearly half of the US beer market.
The Journal quotes William Baer, the Justice Department’s anti-trust division chief – and a former partner at Washington DC law firm Arnold & Porter – as saying potential move was of huge public interest because some $80 billion was spent on beer last year in the US, and even ‘a slight price increase as a result of this deal means American consumers could pay billions more’.

Rising prices

Mr Baer continued: ‘The beer market in the US is already highly concentrated. Prices have gone up in recent years because of this concentration. We believe this acquisition is a bad deal for American consumers.’
According to the Journal, Anheuser has instructed New York white shoe law firm Skadden to defend the proposal, with partner and anti-trust department head Steven Sunshine leading the team. Fellow New Yorkers Cravath is acting for Modelo, with anti-trust partner Christine Varney leading the charge.