WASHINGTON – Anheuser-Busch InBev’s distribution power in the United States is drawing government scrutiny as the brewer seeks antitrust approval to buy SABMiller, an indication the company may need to cede control over how beer gets on shelves.
The Justice Department’s antitrust division, which has been skeptical of past attempts to consolidate brewers, will probably require AB InBev to sell SABMiller’s MillerCoors joint venture to preserve competition, lawyers say. The government will also probably require the company to give up control over MillerCoors distribution, said Jennifer Rie, an analyst at Bloomberg Intelligence. Antitrust authorities may also prohibit AB InBev from penalizing distributors that carry rivals’ products, Rie added.
AB InBev said in a statement it would commit to try to obtain any regulatory clearances required to close the transaction.
The U.S. review of the $106 billion combination will be led by Bill Baer, the head of the department’s antitrust division, who sued to block AB InBev’s takeover of Grupo Modelo SA in 2013. The government dropped the complaint after AB InBev agreed to sell Modelo’s entire U.S. business to Constellation Brands Inc. The government also imposed requirements to limit AB InBev’s ability to interfere with Constellation’s distribution of Modelo labels.
Together, AB InBev and SABMiller will be the world’s largest consumer-staples company by earnings, according to Exane BNP Paribas analysts. The enlarged brewer will have the No. 1 or 2 positions in 24 of the world’s 30 biggest beer markets, they estimate.