A group of consumers who claimed Anheuser-Busch InBev NV (ABI)’s $20 billion acquisition of Grupo Modelo SAB (GPMCF) will lead to higher beer prices lost their bid for a court order blocking the deal.
It would be “difficult and awkward at this point to set aside the transaction” completed yesterday morning, U.S. District Judge Maxine Chesney said at a hearing yesterday afternoon in San Francisco. She considered a request for a temporary restraining order by Joseph Alioto, attorney for nine consumers who filed an antitrust lawsuit to block the deal on grounds that it will reduce competition.
Budweiser-maker AB InBev, the world’s largest beer company, agreed as part of the merger to sell Mexico City-based Modelo’s stake in their joint U.S. distribution venture to Constellation Brands Inc. (STZ) for $1.85 billion. Constellation “will be in no position to maintain lower prices in the face of ABI constant pressure to increase prices,” Alioto said in a June 3 court filing.
“The plaintiff would have to show that it is not a legitimate transaction, that it’s a sham,” Chesney said. “I do not find that the plaintiff has made that showing by this time.”
The U.S. said its agreement with Leuven, Belgium-based AB InBev to turn Victor, New York-based Constellation into a competing brewer could save beer drinkers almost $1 billion a year because of lower prices.
Alioto has sued to block other deals, including the one that created United Continental Holdings Inc. and the merger of Southwest Airlines Co. (LUV) and AirTran Holdings Inc.
The case is Edstrom v. Anheuser-Busch InBev NV, 13-cv-01309, U.S. District Court, Northern District of California (San Francisco).
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