The Wall Street Journal reports that the DOJ filed an antitrust suit this morning aimed at blocking the $20.1 billion deal that would have given AB InBev, which already owns a 50% non-controlling stake in Grupo Modelo, ownership of the entire company.
The merger would have resulted in a combination of the nation’s largest and third-largest beer companies in the U.S. Together, the companies control nearly half of the beer sold in the country. To the DOJ, this consolidation means “less competition and higher beer prices for American consumers.”
Additionally, the DOJ pointed to Modelo’s importance in competitive beer pricing. The regulators claim that AB InBev and the folks at MillerCoors simply follow each other’s price changes instead of trying to compete on price, while Modelo has resisted the bigger companies’ lead in raising retail prices.
AB InBev disagrees and says it will fight the lawsuit, which it deems, “inconsistent with the law, the facts and the reality of the marketplace.”