A group of consumers who claimed Anheuser-Busch InBev NV (ABI)’s $20 billion acquisition of Grupo Modelo SAB (GPMCF:US) 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:US) 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:US) 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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