The world's largest brewer is getting even bigger. Anheuser-Busch InBev announced plans early on Friday to buy a remaining 50 percent of the Mexican brewing giant, Grupo Modelo, for $20 billion.
The purchase will give A-B InBev complete control of the company and access to Modelo’s popular Corona, Modelo, Negra Modelo and Pacifico brands.
Speaking in a conference call Modelo CEO Carlos Fernandez says the move is necessary step to export his brands around the globe.
“This is a momentous transaction for Grupo Modelo and I truly believe also for Mexico,” Fernandez said. “It will further propel us onto the world stage providing additional growth opportunities for our brands.”
A-B InBev says it expects the merger to save at $600 million annually. Unlike InBev's takeover of Anheuser-Busch in 2008, Modelo’s headquarters will be allowed to remain in Mexico City with a local board of directors.
Combined, the two companies will have 150,000 employees and annual revenue totaling nearly $47 billion.
With the addition of Modelo AB-InBev’s combined U.S. market share will reach 53-percent, raising concerns that A-B InBev may need to shed a few smaller brands in order to comply with anti-trust regulations.
However, at this point, A-B InBev CEO Carlos Brito said they "don't anticipate any divestitures."
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