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Labatt USA sale deadline extended

Anheuser-Busch InBev has been given an additional 30 days to divest itself of Labatt USA, a condition of the two companies' merger under an agreement with the U.S. Department of Justice.

Anheuser-Busch InBev now has until March 14, according to the Justice Department, which did not provide a reason for the extension.

How the process turns out is being watched closely locally because Labatt USA is headquartered in Buffalo. In addition to its local jobs, Labatt USA has sponsored events like this weekend's pond hockey tournament at the Erie Basin Marina. A spokesperson for Anheuser-Busch InBev did not return requests on Friday to comment on the extension.

Labatt USA oversees the import and marketing of Labatt products in the United States. The divestiture will not affect Labatt operations in Canada.

InBev has completed its $52 billion acquisition of Anheuser-Busch. But the federal government raised concerns about possible anticompetitive practices in Upstate New York resulting from the merger, leading to the requirement that Labatt USA be divested.

About half of the sales of Labatt-brand beer in the United States are to customers in the Buffalo, Rochester and Syracuse metro areas, according to the Justice Department. Government officials were concerned that an InBev merger with Anheuser-Busch would drive up beer prices in those three markets, since those two families of brands are the two biggest sellers in those markets.

Labatt USA employs about 55 people, about 20 of whom work in offices in Key Tower. How the local offices, which moved here in 2007, would be affected by a divestiture isn't yet known.

Anheuser-Busch InBev agreed to sell Labatt USA and grant a license to the buyer to brew and sell Labatt-brand beer throughout the United States. InBev will brew and supply it to the licensee for up to three years. The Justice Department must approve the purchaser.

The deal between InBev and the Justice Department was announced last November. InBev was given a divestiture deadline of 90 days at that time.

e-mail: mglynn@buffnews.com

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