Financial thoughts

No. 2 U.S. beermaker SABMiller’s (SAB.L: Quote, Profile, Research) move to combine American operations with No. 3 Molson Coors (TAP.N: Quote, Profile, Research) will likely be approved even though it will increase market concentration, antitrust experts said.

The approval may be a reflection of how much easier it has become for companies to merge under the Bush administration, antitrust lawyers said.

“I would frankly expect that they will (get approval), in part because it’s the Department of Justice,” said Ben Sharp of Perkins Coie LLP, reflecting a view among some experts that the department challenges few mergers.

“I doubt very much that it would have got approval under the Clinton administration,” Sharp said.

Michael Keeley of Axinn, Veltrop & Harkrider, LLP agreed: “I’d be stunned if they did anything to stop this deal.”

Anheuser-Busch (BUD.N: Quote, Profile, Research), which brews Budweiser, Busch and Michelob, is the longtime U.S paydayloans. market leader with just under half of all U.S. beer sales. Miller holds 18.7 percent of the market and Coors 11 percent, according to Michael Scherer, who teaches management at Harvard’s Kennedy School of Government. The rest of the market is shared by imports and microbrewed beers.

The proposed merger would give Anheuser-Busch and the new MillerCoors joint venture control over nearly 80 percent of the U.S. beer market.

According to the Herfindahl-Hirschman Index used by antitrust experts, the U.S. beer market is already concentrated and the joint venture would push the index up by more than 300 points. Deals that raise the index by more than 100 points in concentrated markets “presumptively raise antitrust concerns,” according to the Justice Department’s merger guidelines. 

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