Anheuser-Busch to Divest Stake in Chicago’s City Beverage

As part of a bill proposed to the Illinois House of Representatives this week, Anheuser-Busch has agreed to sell its 30 percent stake in City Beverage, the brewer’s largest Chicago-area distributor, according to The Chicago Tribune. The agreement alleviates concerns by some that Anheuser-Busch’s stake in the distributor would decrease the variety of beer sold to retailers.

The bill, HB 2606, which was introduced by Reps. Frank Mautino (D-Spring Valley) and David Leitch (D-Peoria), would amend the Liquor Control Act of 1934 and would mandate that licensed beer manufacturers cannot have direct or indirect interest in a holder of a distributor’s license or an importing distributor’s license.

“Anheuser-Busch is pleased with the agreement reached with the Illinois legislature as it relates to our minority investment in City Beverage,” Mark Bordas, region vice president of state affairs with Anheuser-Busch, said in a statement.

With the agreement in place, the bill is expected to pass easily in the Illinois House.

“I know of no opposition to my legislation,” Rep. Frank Mautino said in a statement that was released Wednesday by the Associated Beer Distributors of Illinois.

The bill follows years of Anheuser-Busch tussling with the state for the rights to the distributor. In February 2010, the Illinois Liquor Control Commission blocked the beer giant’s attempt to buy out City Beverage. In October, a federal judge ruled the law discriminatory, allowing the beer giant to retain its stake. However, the judge also denied the right for out-of-state brewers to distribute their own products in Illinois, which led to legislation that banned in-state and out-of-state brewers from self-distribution.

Anheuser-Busch has until Jan. 1, 2015, to sell its 30 percent stake in City Beverage. Investment firm BDT Capital currently owns the remaining 70 percent of the distribution company.