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Beverage NewsBeer

Constellation Brands completes acquisition of Grupo Modelo's US beer business

Acquisition nearly doubles company's sales

June 10, 2013

Constellation Brands Inc., Victor, N.Y., announced that it completed its acquisition of Grupo Modelo's U.S. beer business from Anheuser-Busch InBev, Leuven, Belgium, for approximately $4.75 billion. The transaction includes full ownership of Crown Imports LLC, which provides Constellation with complete, independent control of all aspects of the U.S. commercial business; a state-of-the-art brewery in Nava (Piedras Negras), Mexico; an exclusive perpetual brand license in the United States to import, market and sell Corona and the Modelo brands Crown currently sells; and the freedom to develop brand extensions and innovations for the U.S. market.

"Today begins a new chapter in Constellation's history," said Rob Sands, president and chief executive officer of Constellation Brands, in a statement. "We are now the proud owners of six of the Top 20 imported beer brands in the U.S. and a coveted portfolio of premium brands in the growing U.S. imported beer category. We are committed to successfully running and investing in the world-class Mexican brewery and are very excited about the potential for developing new products and line extensions within the portfolio of brands in the U.S."

The Crown portfolio includes Corona Extra, Corona Light, Modelo Especial, Negra Modelo, Pacifico and Victoria from Mexico as well as Tsingtao from China. In fiscal year 2012, Crown outperformed the import and total U.S. beer categories for the third consecutive year as Corona Extra exceeded the 100-million case mark for the year, according to Constellation Brands. It was the only imported brand in the United States to achieve this sales milestone, it adds. Modelo Especial also achieved a significant milestone by selling more than 40 million cases in depletions for the year, it says.

With the close of the acquisition, Constellation will operate as one company with two divisions: a beer division and a wine and spirits division. A brewery operations group also has been established to manage the expansion and integration of the Nava brewery, it says. Constellation plans to invest $500-$600 million during the next three years to expand the facility to double its current capacity to meet projected demand for products in the United States. Paul Hetterich, executive vice president for business development and corporate strategy, leads this team.

Bill Hackett, president of the beer division, retains his current responsibilities for importing, marketing and selling the Modelo brands in the United States. Hackett joins the company's executive management committee and reports directly to Sands.

Constellation's wine and spirits division is led by Jay Wright, president, who will continue to report to Sands.

"I am very pleased to welcome the Crown and the Nava employees to the Constellation family, and I would like to thank everyone who has worked tirelessly during the last year to make this transaction a reality,” Sands said in a statement. “This is an exciting time for our people and for our company.”
 

KEYWORDS: Anheuser-Busch Constellation Brands Grupo Modelo

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