Chris Mercer

Constellation, Modelo retake vows

By: Chris Mercer - 29 October 2010 15:29

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Constellation Brands and Grupo Modelo have kissed and made up, so it looks like Crown Imports will be sticking around.

Constellation and Modelo said today that they have settled their legal dispute over marketing funds for the Crown Imports beer venture in the US. The 50-50 venture imports Modelo's Corona lager among others.

It looked as if the venture might be coming to a premature end (it runs until 2016) when Modelo signalled that it would sue its partner at the end of 2009. But, today, everyone is back in bed.

Constellation has repeatedly called the dispute "financially immaterial" and it looks as though the two firms will, afterall, continue to work together.

The most likely alternative for Modelo, assuming it could have afforded the Crown Imports cancellation fees, would have been a deal with Anheuser-Busch InBev. The Budweiser brewer holds a 50% non-controlling stake in Modelo.

However, Modelo's controlling families don't have a lot of love for A-B InBev, as they proved in the UK recently by snubbing the group in favour of rival Molson Coors.

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