Anheuser-Busch InBev CEO to Defend SABMiller Deal Before Congress

(Bloomberg News/TNS) -

Anheuser-Busch InBev CEO Carlos Brito will try to ease concerns of U.S. lawmakers about the brewer’s proposed $110 billion acquisition of SAB Miller, which would create an entity accounting for about half the beer industry’s profit and almost a third of all beer sold worldwide.

Brito, Molson Coors Brewing CEO Mark Hunter and other industry officials are scheduled to testify Tuesday in Washington before a subcommittee of the Senate Judiciary Committee. The panel will review how combining the world’s two biggest beer producers would affect competitors and consumers. The combined company would hold the No. 1 or No. 2 positions in 24 of the world’s 30 largest beer markets.

As part of the deal, AB InBev plans to sell SABMiller’s 58 percent stake in MillerCoors to joint-venture partner Molson Coors for $12 billion as it seeks to gain approval from the U.S. Justice Department. The Senate subcommittee has no power to block the merger.

The planned acquisition has already drawn scrutiny from senators, including Angus King, an independent of Maine, and Jeff Merkley, an Oregon Democrat, who wrote to the Justice Department with concerns that it could hurt the U.S. craft beer industry. Sen. Ron Wyden, also an Oregon Democrat, wrote to the Federal Trade Commission with concerns over reports that AB InBev and its distributors may have acted to curb competition in markets, including in his home state of Oregon, where beer drinkers are suing to block the takeover.

The Justice Department and the California attorney general are scrutinizing AB InBev’s plan to acquire two distributors in that state, which could potentially hurt craft brewers’ representation in liquor stores. Last week, The Wall Street Journal reported that the brewer is offering distributors a $1.5 million annual incentive if 98 percent of the beers they sell are AB InBev brands.