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Fri February 1, 2013
Justice Department Moves To Block Beer Merger
Originally published on Fri February 8, 2013 9:38 am
RENEE MONTAGNE, HOST:
NPR's business news starts with fears of a beer monopoly.
(SOUNDBITE OF MUSIC)
MONTAGNE: The Justice Department has filed a lawsuit to block Anheuser-Busch InBev from buying Grupo Modelo, the brewer of Corona.
As NPR's Ailsa Chang reports, the government says preventing the acquisition is the only way to keep beer prices down.
AILSA CHANG, BYLINE: Beer drinkers of America, the Justice Department says it's looking out for you. Right now, you spend about $80 billion a year buying beer. And the government says, you're going to be spending billions more if two beer giants get a little cozier with each other.
(SOUNDBITE OF BUD LIGHT AD)
UNIDENTIFIED WOMAN: This is so romantic.
UNIDENTIFIED MAN: Well, it's about to get a little more romantic. A little candlelight.
UNIDENTIFIED WOMAN: Ohh...
UNIDENTIFIED MAN: And, a little Bud Light.
UNIDENTIFIED WOMAN: Mmmm.
CHANG: Bud Light is the most popular beer in America, and that's one of the reasons its brewer - Anheuser-Busch - is the leading beer seller in the country. Modelo is number three.
If the two of them hooked up, Assistant Attorney General Bill Baer says they will control half of all beer sales in the U.S., and therefore, effectively determine the price of beer.
BILL BAER: It's the very kind of concern for anti-consumer impact that the antitrust laws tell us we're supposed to protect against.
CHANG: People who've been watching the beer industry says it's actually been consolidating for decades.
Barry Lynn of the New America Foundation, a policy group, says back in the late '70s, there were about 50 beer companies. That market is almost gone now.
BARRY LYNN: Although you have this huge explosion in the number of craft brewers in this country, those companies are really isolated in about five to six percent of the marketplace. They're essentially marginalized.
CHANG: Anheuser-Busch says it will be vigorously contesting the government's action in federal court.
Ailsa Chang, NPR News, New York. Transcript provided by NPR, Copyright NPR.