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Senate Dem issues warning on beer merger

Senate Dem issues warning on beer merger
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Sen. Chris MurphyChristopher (Chris) Scott MurphyUS to stop refueling Saudi planes in Yemen Murphy easily defeats Republican challenger in Connecticut Poll: Democrat Ned Lamont's lead halves in Connecticut governor race MORE (D-Conn.) is raising concerns about the proposed merger between the world’s two largest beer companies.

In a letter to the Justice Department (DOJ) on Friday, Murphy warned that Anheuser-Busch InBev’s $106 billion takeover of rival SABMiller could have a devastating impact on small craft brewers.

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"As the Department of Justice reviews this merger, I urge you to specifically consider the impact it will have on competition and access for all American brewers, particularly those in the independent craft brewing industry,” Murphy wrote.

"I believe careful review is necessary to ensure that consumers are protected and economic competition is preserved,” he added.

Anheuser-Busch, which brews Budweiser, agreed last month to purchase its chief rival SABMiller, the maker of beers such as Miller.

The merger would create a beer giant that — as it currently stands — controls 30 percent of global beer production.

The DOJ is expected to scrutinize the proposed merger, which has yet to be approved by regulators. Anheuser-Busch could be required to sell off SABMiller’s stake in Coors for the deal to proceed, experts say.

But Murphy and other lawmakers have raised concerns about the impact the beer merger would have on smaller craft brewers and consumers.

Craft brewers employ more than 400,000 workers and are responsible for generating more than $55 billion each year, according to Murphy.

"Merging these two companies into a larger market player with the ability to control an even greater share of the supply and distribution chains could have a significant impact on the continued viability of the currently thriving craft beer industry,” Murphy wrote.

“Many of these breweries have informed me, for example, that they consistently have difficulty procuring sufficient cans to distribute their product, raising concerns that larger producers like AB InBev and SAB Miller may already be impacting the supply of this critical component for their business,” he added.