Anheuser-Busch InBev (BUD), Grupo Modelo, S.A.B. de C.V. (GPMCY.PK), Constellation Brands, Inc. (STZ, STZ.B) and Crown Imports LLC, have reached a final agreement with the U.S. Department of Justice on the terms of a settlement of the Department of Justice's litigation challenging AB InBev's proposed acquisition of the remaining stake in Grupo Modelo that it does not already own.
Anheuser-Busch stated that the parties have jointly approached the Court with the terms of a proposed Final Judgment, which would fully resolve the Department of Justice's claims in its litigation challenging the proposed acquisition.
Anheuser-Busch noted that the agreement is substantially in line with the revised transaction announced on February 14, 2013. The proposed Final Judgment presented to the Court includes additional binding commitments to the revised transaction, which are designed to ensure a prompt divestiture of assets by AB InBev to Constellation, the necessary build-out of the Piedras Negras brewery by Constellation, as well as certain distribution guarantees for Constellation in the United States.
Once the Stipulation and Order is signed by the Court, AB InBev, Grupo Modelo and Constellation intend to move swiftly to complete the pending transactions. These include an all-cash tender offer of US$9.15 per share by AB InBev for all the outstanding Grupo Modelo shares it does not already own and, upon completion of the tender offer, the sale of Grupo Modelo's Piedras Negras brewery and stake in Crown to Constellation, AB InBev said.
The Mexican Competition Commission approved the revised transaction with Constellation in early April 2013. Therefore, once the Stipulation and Order is signed, all regulatory approvals necessary for closing the transactions with Grupo Modelo and Constellation will have been obtained. The transaction is expected to close in June 2013, Anheuser-Busch said.
In late January, the DoJ filed a civil antitrust lawsuit to block AB InBev's proposed $20.1 billion deal to acquire total ownership and control of Mexican brewer Modelo, claiming the deal would result in less competition and higher beer prices for American consumers.
AB InBev's Bud Light is the best selling beer in the U.S. and Modelo's Corona Extra is the best-selling import. AB InBev and Modelo, the largest and third largest beer firms, respectively, together control about 46 percent of annual sales in the U.S.
AB InBev agreed in late June 2012 to acquire the remaining stake in Modelo by paying the Corona beer maker $9.15 per share in cash or about $20.1 billion. AB InBev, the world's largest brewer, acquired a 50 percent stake in Modelo through InBev's 2008 purchase of Anheuser-Busch for $52 billion.
As part of the proposed deal, Modelo also agreed to sell its existing 50 percent stake in Crown Imports to Constellation for $1.85 billion. Crown Imports is Modelo's joint venture with Constellation that imports and markets Modelo's brands in the U.S.
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