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Proposed beer merger could hurt competition in U.S.

Anheuser-Busch InBev's purchase of Grupo Modelo would make it an even bigger player in the U.S. beer market.

This year, Anheuser-Busch InBev hopes federal regulators will approve its $20 billion bid to buy Mexico’s Grupo Modelo, which makes Corona and Pacifico. Anheuser-Busch InBev is the world’s largest beer maker, but given the explosion in beers available, the average consumer might think there’s plenty of competition.

At grocery stores, and at bars like Churchkey in Washington, D.C., there are more brands of beer than there used to be. But there’s a catch.

“You know, how many people know that Stella, Leffe, and Hoegarten are part of the same company that produces Budweiser now,” says Greg Engert, the “beer director” at Churchkey. Engert's kind of like a sommelier, but for beer.

Barry Lynn, a fellow at the New America Foundation, argues that over the years, Anheuser Busch-InBev and the world’s second largest beer company, MillerCoors, have created a monopoly. Neither company replied to our requests for interviews.

“They have this remarkable ability to make it seem as if this is the most competitive of marketplaces,” Lynn says.

What is competitive, Greg Engert says, is the craft beer market.  More demand has led to more breweries.

“They’re saying that 500 are going to open next year, and then there are over a thousand in planning,” Engert says.

But craft beer accounts for just six percent of all the beer sold in the U.S.  90 percent comes from Anheuser-Bursch In-Bev and MillerCoors.

About the author

David Gura is a reporter for Marketplace, based in the Washington, D.C. bureau.
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