Constellation Brands Pays $600 Million To Buy Grupo Modelo Brewery

Constellation Brands Inc. announced Monday a deal to buy Grupo Modelo's brewery in Obregon, Mexico for $600 million. Grupo Modelo is a subsidiary of Anheuser-Busch InBev S.A. . Constellations will use the brewery, which is expected to have four million hectoliters of production capacity, to expand its high-end Mexican beer portfolio. "We believe this is the right strategy to provide near-term capacity and greater flexibility to support our growth and innovation plans, while allowing for the buildout of our Mexicali brewery over an extended time period," said Chief Executive Rob Sands. Constellation Brands shares tacked on 1.1% in light premarket trade, while Anheuser-Busch's stock slipped 1.2%. Year to date, Constellation Brands shares has climbed 17% while the S&P 500 has gained 4%.

Copyright © 2016 MarketWatch, Inc.