Senators pressed the heads of the world’s top beer producers in a hearing Tuesday for more information on how their proposed merger will affect the competitiveness of a marketplace where craft brewers are thriving.
Anheuser-Busch InBev’s has offered to buy SABMiller for over $100 billion. As part of the deal, Molson Coors has agreed to purchase SABMiller’s remaining interest in MillerCoors.
Mark Hunter, president and CEO of Molson Coors, said what exists today as MillerCoors will remain unchanged after the merger.
“It will not change consumer choice; it will not change the competitive pricing environment; it will not change our market share or our longstanding support for the three-tier system; it will not change our support of US growers and suppliers; and it will not change the explosive growth of craft brewers or their access to the market through the MillerCoors distributor network,” he said.
During the hearing of the Senate Judiciary subcommittee on antitrust, Sen. Chris Coons (D-Del.) questioned Anheuser-Busch InBev’s efforts in recent years to acquire craft breweries and distributors. Some, he said, have suggested that this is a ploy to constrain some of the distribution channels of its competitors, which including craft breweries.
Coons asked the company’s CEO, Carlos Brito, to respond to those allegations and answer whether the company would be using the profits from this merger to continue acquiring competitors.
“In terms of the 4,000 breweries we have in this country, and there’s two opening a day, we own five and we have a minority stake in a sixth one,” Brito said. “The reason we do that, just like we do with our company-owned wholesalers, is we can learn from amazing entrepreneurs who created brands and how they are connected to local consumers. We grow our company by learning from others.”
Brito went on to give Coons the same answer he had given for questions asked by other subcommittee members.
“This transaction is not going to affect the U.S. market,” he said.
Brito said the goal of the transaction is to expand Anheuser-Busch InBev brands to Africa, Asia and parts of Latin America.
Sen. Chuck Grassley (R-Iowa) said lawmakers are most concerned about the increased leverage that a combined company would have and what that might mean for the thriving beer industry, as well as consumer choice and product prices.
“Obviously the antitrust regulators will be looking at this deal to determine whether there are any anticompetitive aspects that need to be addressed,” he said. “But it’s important that we in Congress have an opportunity to flesh out these concerns.”