Release the lawyers! West coast brewers sue over AB InBev/SABMiller merger

December 4, 2015Keith Gribbins

SAB Miller Miller 64 — Also, can we somehow include Miller 64 in that suit? This stuff is the pits. Photo Credit: Tom Parker/OneRedEye

While we can’t seem to zero in on whom exactly these brewers are and aren’t (which just adds to the mystery!), reports are floating around the internet that a lawsuit from 19 Oregonians, three Californians and one Washingtonian (some of them craft brewers) is seeking to stop Anheuser-Busch InBev from buying SABMiller (thus forming the dreaded Beer Voltron). The suit argues the acquisition would create an unfair marketplace for other beer companies, which is a pretty solid argument. This is all according to Oregon Live:

“…plaintiffs are threatened with loss or damage in the form of higher beer prices and less consumer options. If defendants’ proposed transaction is consummated, plaintiffs will sustain irreparable harm for which damages will be unable to compensate plaintiffs, in that competition once lost cannot easily be restored,” the lawsuit says.

Alas, this article is super vague, and unfortunately that’s really not an argument that will stop the long-assumed merger of these global beer titans, both of which have already gone back to counting their money. AB InBev, whose takeover of SABMiller would be one of the largest mergers in corporate history, has already said it expects to achieve $1.4 billion in annual savings four years after completion of the deal. Of course, AB InBev’s $100 billion-plus offer pivots on the onus that it will sell the SABMiller’s stake in its U.S. venture with MillerCoors to help win regulatory approval. Win?

But the real concern here and not mentioned in the quote above is AB InBev’s buyout of SABMiller would, in theory, allow both companies to eliminate their largest source of competition while combining the distribution outreach of their product portfolios. 1) AB InBev is already disrupting the independent and competitive middle distribution tier (read about it here), making fair distribution a continued hurdler for small brewers. 2) Over time, AB InBev will have significant new global revenues to invest in the United States. This lawsuit is aimed at stopping the acquisition before it officially happens (basically the same plot to Terminator). And it’s not just for brewers: Plaintiffs feel they’re fighting for the craft industry and the consumer as well. Back to Oregon Live:

Christopher Cauble, a Southern Oregon lawyer who has joined forces with San Francisco attorney Joseph Alioto on the case, said they want to stop the sale before it happens, which is when craft brewers could mount a legal challenge.

Oregon is consistently ranked near the top of lists counting dollars spent on craft beers and the number of in-state breweries.

“Oregon is more impacted by this due to our large craft beer industry and the large amount of people who drink craft beers,” Cauble said. “(The plaintiffs) basically seeing it as they’re fighting on behalf of all other consumers who would be impacted by this.”