Constellation Brands Inc : Constellation Brands Receives DOJ Clearance to
Proceed with Acquisition of Grupo Modelo's U.S. Business
~ Company to become #3 producer and marketer of beer for the U.S. ~
VICTOR, N.Y., April 19, 2013 - Constellation Brands, Inc. (NYSE: STZ and
STZ.B), Anheuser-Busch InBev (Euronext: ABI; NYSE: BUD), and Grupo Modelo,
S.A.B. de C.V. (BMV: GMODELOC), 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.
Constellation will become a fully independent beer competitor in the U.S. with
perpetual rights for the Modelo brands currently sold by Crown and autonomous
control of distribution, marketing, promotion and pricing. In addition,
Constellation will have full control of its production and supply chain and
have full rights to create line extensions and new brands to continue to drive
"The Crown acquisition represents a significant milestone for Constellation as
the most transformational event in the history of our 68-year-old company,"
said Rob Sands, president and chief executive officer, Constellation Brands.
"Overall, this transaction will nearly double the sales of our company,
significantly enhance our earnings and free cash flow, diversify our profit
stream and provide new avenues for growth. It will solidify our place in the
U.S. beer market for the long term as the brand owner and producer of the
iconic Modelo portfolio of brands in the U.S. with Corona Extra, the best
selling imported beer, Corona Light, the leading imported light beer and
Modelo Especial, the third largest and the fastest growing major imported beer
brand in the category."
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.
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 (which is filed concurrently with, and requires
the parties to comply with, the proposed Final Judgment) 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
USD 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.
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 occur around the end of Constellation's first quarter fiscal
2014 or shortly thereafter.
About Constellation Brands
Constellation Brands is the world's leading premium wine company that achieves
success through an unmatched knowledge of wine consumers, storied brands that
suit varied lives and tastes, and more than 4,400 talented employees
worldwide. With a broad portfolio of widely admired premium products across
the wine, beer and spirits categories, Constellation's brand portfolio
includes Robert Mondavi, Clos du Bois, Kim Crawford, Inniskillin, Franciscan
Estate, Mark West, Ruffino, Simi, Estancia, Corona Extra, Black Velvet
Canadian Whisky and SVEDKA Vodka.
Constellation Brands (NYSE: STZ and STZ.B) is a S&P 500 Index and Fortune
1000® company with more than 100 brands in our portfolio, sales in about 100
countries and operations in approximately 40 facilities. The company believes
that industry leadership involves a commitment to our brands, to the trade, to
the land, to investors and to different people around the world who turn to
our products when celebrating big moments or enjoying quiet ones. We express
this commitment through our vision: to elevate life with every glass raised.
To learn more about Constellation, visit the company's website at
This news release contains forward-looking statements. All statements other
than statements of historical fact are forward-looking statements. The word
"expect" and similar expressions are intended to identify forward-looking
statements, although not all forward-looking statements contain such
identifying words. These statements may relate to business strategy, future
operations, prospects, plans and objectives of management, as well as
information concerning expected actions of third parties. All forward-looking
statements involve risks and uncertainties that could cause actual results to
differ materially from those set forth in, or implied by, such forward-looking
statements. The transactions described in the news release (collectively, the
"Transactions") are subject to the satisfaction of certain closing conditions,
including receipt of any necessary regulatory approval and the consummation of
certain transactions between Anheuser-Busch InBev SA/NV and Grupo Modelo,
S.A.B. de C.V. and certain of its affiliates. All forward-looking statements
speak only as of the date of this news release and Constellation Brands
undertakes no obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise. The
forward-looking statements are based on management's current expectations
should not be construed in any manner as a guarantee that such results will in
fact occur or that the Transactions will occur or occur on the timetable
In addition to the risks and uncertainties of ordinary business operations,
the forward-looking statements of Constellation Brands contained in this news
release are subject to a number of risks and uncertainties, including
completion of the Transactions on the expected terms, the availability of
financing on the expected terms, the ability to realize the expected benefits
of the Transactions, and other factors and uncertainties disclosed in the
company's filings with the Securities and Exchange Commission, including its
Annual Report on Form 10-K for the fiscal year ended February 29, 2012, as
supplemented by the company's Quarterly Report on Form 10-Q for the fiscal
quarter ended May 31, 2012, which could cause future performance to differ
from current expectations.
Angela Howland Blackwell: 585-678-7141
Cheryl Gossin: 585-678-7191
Patty Yahn-Urlaub: 585-678-7483
Bob Czudak: 585-678-7170
This announcement is distributed by Thomson Reuters on behalf of Thomson
The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and other
applicable laws; and
(ii) they are solely responsible for the content, accuracy and originality of
information contained therein.
Source: Constellation Brands Inc via Thomson Reuters ONE
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