US Justice Department to Investigate AB-InBev After Complaints of the Company Pushing Craft Beer out of Distributors

by Alexander Frane on Oct 20, 2015 in Beer
US Justice Department to Investigate AB-InBev After Complaints of the Company Pushing Craft Beer out of Distributors

Craft brewers may have more to worry about from AB-InBev than its acquisition of SABMIller, as the US Justice Department investigates the company’s purchase of multiple distributors.

Last week, the beer world was shaken by the news that AB-InBev had reached an agreement with its rival company, SABMiller, to purchase the latter. The resulting merger would create a behemoth that controls more than 30% of the world’s beer sales. The announcement came on the heels of the purchase of the Canadian Mill Street Brewery, and the purchase of Elysian, from Seattle, earlier this year. What was less reported was the acquisition of wholesalers: five of them in three states, to be exact.

In the US, beer is moved from breweries to stores and bars by third party companies, known as wholesalers or distributors. In this three-tier-system, beer makers do not sell their beers directly, but rely on these wholesalers to do so. However, laws exist that allow beer makers to purchase wholesalers, as is the case with AB-InBev.

Now, the US Justice system is investigating complaints that AB-InBev is creating a market where it drives out craft competitors by controlling the wholesalers. Craft brewers are claiming that once a wholesaler is purchased by AB-InBev, they stop buying the craft product, or simply don’t work to move the product. Instead, AB-InBev offers only its own products, including the small amount of craft breweries it owns, such as Elysian, 10 Barrel, and Goose Island. The strategy makes sense, as recent years have seen a plateau in global beer sales, while craft beer sales continue to climb.

This strategy makes sense when combined with the purchase of SABMiller, as well—the acquisition would give the company access to the African and southeast Asian markets, while the purchase of wholesalers would allow it more control over the domestic markets. The Justice Department is just launching its investigation; until some evidence is revealed, we can but speculate. 

Photo via Flickr user dlofink


Tags: Beer
Recent Articles
spacer

Feedback

How are we doing? Tell us what you like or don't like and how we can improve. We would love to hear your thoughts!

*Name:
*E-mail:
*Suggestions:
 
Where to Imbibe in Denver on Black Friday
by Carrie Dow Nov 21, 2017
Get in Formation: A Beyonce-Themed Bar is Coming to Brooklyn

Get in Formation: A Beyonce-Themed Bar is Coming to Brooklyn

Starting on December 1, Brooklyn bar Leyenda will transform itself into a real-life Beyhive for the holidays in honor of Beyonce....read more ›

by The Drink Nation Nov 14, 2017
Fri
Dec 1
Wed
Dec 6
Del Frisco's Double Eagle Steakhouse 
Thu
Dec 7
SPONSORED
Deck Your Halls With These Whiskey-Filled Ornaments

Deck Your Halls With These Whiskey-Filled Ornaments

Forget the tinsel and string lights - the UK's Lakes Distillery has released a line of booze-filled ornaments just in time to make your holiday season...read more ›

by Jessie Donofrio Nov 14, 2017
Colorado Wines to Shine this Holiday Season

Colorado Wines to Shine this Holiday Season

All of these wines are 2017 winners in the Colorado Governor's Cup....read more ›

by Carrie Dow Nov 14, 2017
Celebrate National Yeti Day at Great Divide Brewing

Celebrate National Yeti Day at Great Divide Brewing

Friday, November 17, is the second annual National Yeti Day. ...read more ›

by Carrie Dow Nov 14, 2017
Enjoy a Taste of Fall with These Denver Cocktails

Enjoy a Taste of Fall with These Denver Cocktails

These seasonal sips will light you up as the days get shorter....read more ›

by Carrie Dow Nov 14, 2017
Celebrate the Dark Side at Wynkoop's Day of Darks

Celebrate the Dark Side at Wynkoop's Day of Darks

It's a taste of Denver's darker side. ...read more ›

by Carrie Dow Nov 7, 2017
Molly's Spirits to Host Animal Adoption Event
by Carrie Dow Nov 6, 2017
Napa Valley is Running a Christmas-Themed Wine Train to the 'North Pole' For the Holidays

Napa Valley is Running a Christmas-Themed Wine Train to the 'North Pole' For the Holidays

If you've ever wanted to travel to the North Pole for the holidays, you can - but you have to get to the Napa ...read more ›

by The Drink Nation Nov 6, 2017
SPONSORED
View all Articles

Sign up to get weekly drinking news, bar reviews, events and more sent directly to your inbox!

Close