Constellation is now U.S.'s #3 beer supplier




The acquisition of U.S. distribution rights for Grupo Modelo beers and a Mexican brewery from Anheuser-Busch InBev makes Constellation Brands Inc. the third-largest beer supplier,

the

Wall Street Journal

reported.

Constellation already is one of the world’s largest wine companies, the article said.

AB InBev divested itself of the U.S. distribution rights to Modelo beers and the brewery in order to obtain Justice Department approval for its takeover of Grupo Modelo.

The

Journal

report noted that Constellation, now publicly traded, began selling bulk wine in 1945. Its three CEOs have all come from the founding Sands family. The family has voting control, the

Journal

article said.

The

Journal

article noted that Constellation “has repeatedly reinvented itself through a flurry of acquisitions and divestments.” After the Modelo deal, Constellation’s revenue will double to more than $5 billion, half of which will come from beer, the article said. The company’s share price has risen 140% since last June.

- Advertisement -

Constellation plans to invest up to $600 million in the next three years to double capacity at the Mexican brewery it has acquired as part of the deal, the

Journal

article said. Constellation CEO Rob Sands told the

Journal

that although his company lacks brewing experience, the brewery is highly automated, and he is considering offering raises to keep essential brewery personnel at the company. Sands also told the

Journal

he expects that the acquisition will result in a better negotiating position with suppliers and retailers. (Source:

Wall Street Journal,

June 7, 2013.)

About the Author(s)

This is your 1st of 5 free articles this month.

Introductory offer: Unlimited digital access for $5/month
4
Articles Remaining
Already a subscriber? Please sign in here.

Related Articles

KEEP IT IN THE FAMILY

The Family Business newsletter. Weekly insight for family business leaders and owners to improve their family dynamics and their businesses.