'Substantial Progress' in AB InBev, Modelo Talks
Beer companies, Justice Department seeking still more time to resolve anti-trust issues
WASHINGTON -- Anheuser-Busch InBev NV, Mexico's Grupo Modelo SAB and the U.S. Department of Justice asked a federal court Friday to allow more time for settlement talks that could resolve a government antitrust lawsuit challenging the companies' planned merger, according to a Dow Jones report.
The parties said in a joint court filing that they have made "substantial progress" toward a resolution, based on revised terms of the beer merger that the companies announced after the Justice Department sued to block the original deal in late January. The extra time "will likely enable the parties to complete their discussions," they said.
The Justice Department and the companies asked a Washington federal judge to postpone litigation until April 9. The parties had previously requested a stay of proceedings that was set to expire March 19.
AB InBev is seeking to acquire the 50% of Modelo it doesn't already own. With the revised deal terms, AB InBev offered to sell an additional $2.9 billion of assets to Constellation Brands Inc. in a bid to rescue the proposed $20.1 billion Modelo takeover.
Under the new terms, AB InBev agreed to sell Modelo's Piedras Negras brewery in Mexico to Constellation, which would also secure perpetual U.S. licensing rights to five Modelo brands.
The beer companies said the revised deal would preserve Modelo as an independent competitor and address the issues raised by the government.
Constellation also is involved in the settlement talks.
AB InBev, owner of Bud Light and Budweiser, and MillerCoors, maker of the Coors Light brand, are the two leading players in the U.S. beer market. Modelo, whose Corona is the best-selling imported beer in the United States, is third, said the report.