The real Bud Bowl will kick off this summer inside a Washington courthouse, one antitrust lawyer believes.
A well-placed source, who correctly predicted in early January that regulators were going to sue to block the $19 billion Anheuser-Busch InBev buyout of Grupo Modelo, believes A-B will not be able to settle the suit and that it will head to trial — likely this summer.
“There is no way this is going to settle,” the source said. “You can just tell — the two sides are very far apart.”
The Department of Justice, in its biggest action since stopping AT&T from buying T-Mobile, wants A-B to either transfer the license to import Modelo beer into the US to a third party or to sell its US-wholly owned distributors, the source said.
That is too much for A-B to swallow, the source added.
A-B alone has the choice of whether to go to court because Modelo cannot walk away from the deal until the end of the year, a second source said.
Also driving A-B to fight, according to the well-placed source, is that it feels it has a real chance to win in court and get the deal completed by the end of the year.
The DOJ does not do a good enough job defining the beer market in its complaint, the source said.
What the DOJ’s case mainly rests on is that Modelo, maker of Corona beer, has since 2008 been narrowing the price gap between its more expensive beer and lower-priced American competitors, A-B and MillerCoors, by not raising prices.
“These narrowed price gaps frustrate A-B and MillerCoors because they result in Modelo gaining market share at their expense,” the DOJ said in its suit.
A-B’s shares rose 4.2 percent on Friday to $92.28 based partly on reports that it was in settlement talks.
A-B declined to comment. A Modelo spokesperson did not return calls.